Mortgage Insurance is one form of insurance that you take to cover your mortgage repayments in case of redundancy and illness. You might get redundant and the mortgage still needs to be paid. When you become ill and can't go to work for a while, the insurance will pay your mortgage until a certain amount of time. Sometimes the bank who lends you the money will ask you to have this insurance for their benefit as well and yours. At least you know that if you are made redundant or you become ill you got this insurance to cover your mortgage repayments. Hope this helps.