National Friendly has launched Mortgage Protection, a non-underwritten home loan insurance product.
The product protects homeowners’ mortgage repayments in the event they cannot work due to illness or injury.
To arrange the cover, no health or lifestyle questions are asked when applying and there is no upfront medical or financial underwriting.
Once the mortgage has been repaid, the cover continues on a 70% of earnings basis until the policy ends when the holder is 68 years old.
Payments are limited to £2,500 a month, which could be extended to £3,000 to meet other household costs.
Premiums are renewed every three years and policies include a £1,000 rehabilitation benefit to support members return to work after making a claim.
Simpler and more accessible
National Friendly chief executive Graham Singleton (pictured) said a mortgage is the biggest financial commitment most people make, yet it is often the least protected.
“Mortgage advice presents a natural opportunity to address the protection gap by making protection discussions simpler and more accessible for consumers,” he added.
“This is arguably more important than ever following the FCA’s final pure protection market study, highlighting the need for industry action to help more consumers consider their protection needs and access suitable cover.
“Mortgage Protect has been designed to make that protection conversation easier. With no health or lifestyle questions at application and a benefit built around the customer’s mortgage payment, it gives advisers another practical way to help more clients put valuable cover in place.
“For customers, that means greater financial resilience when they may need it most.
“For advisers, it means a more complete mortgage service and another opportunity to help close the protection gap.”