Humans are lazy.
And I’m not just saying that as a broad statement.
We’re hardwired to conserve our energy when making life choices. And yes, you’re included in that ‘Mr I get up every morning at 5 am to do CrossFit for an hour before work’.
It’s science, with the results published in a real-life science-y report called: “Perceptual decisions are biased by the cost to act.”
In actual English, the study found that the amount of effort required to do something influences what we think we see. Or, if we believe there’s too much work involved, we’ll go for the easiest route and tell ourselves that it’s the right one.
Because we’re lazy.
That’s why, when you get a quote for Mortgage Protection (or any type of insurance), it’s reasonable to pick the cheapest insurance and not think about it ever again. But that’s not necessarily the wisest choice, young grasshopper.
A quick refresher in case you need it: Mortgage Protection is the type of insurance you get when you’re buying a house. It pays off the rest of your mortgage to your bank if you die.
Now, let’s start with an example to help make this real.
Jesse is 34 and buying a house with his partner. Jesse really likes CrossFit, because why not? His mortgage is €350,000, and he wants to pay monthly for the 30-year term of his mortgage.
Jesse doesn’t smoke (his body is a temple; I don’t know if you heard, if you haven’t, he’ll tell you soon, but he does CrossFit) and neither does his partner (they’d love to but because Jesse does CrossFit – there’d be murders over smoking).
Jesse’s first thought is probably that it’s between Zurich and Royal London, and that Irish Life are robbing feckers, bleeding their customers dry of that extra €17 a month.
So does Jake take the path of least resistance? Should he?
The crucial thing to remember is that you’re not just paying for Mortgage Protection. There’s also a bunch of other stuff included. So let’s look at what the insurers are all offering for your hard-earned.
Pro-tip: you can see all this information yourself when you get a quote – simply scroll down to the comparison charts.
Cost: Joint Cheapest: +1 for Zurich. They’re also offering:
2. Royal London
Cost: Joint Cheapest: +1 for Royal London. They also do:
Cost: Middle of the pack, so 🤷. You also get:
4. New Ireland Assurance
Cost: A hair more expensive. Hardly a deal-breaker. Also on offer:
5. Irish Life
Cost: Decidedly, the most expensive. -1, chaps. You also get:
So to recap: the thing you need to consider is the price, but also all that extra stuff, which includes:
Also known as Life Events Option (LEO), because insurers love a good-ole, confusing synonym. It lets you increase your Mortgage Protection cover without any health checks/underwriting. It’s useful if you get a bigger mortgage on your second (or third, look at you with all your houses) go around.
Keep an eye on what’s offered: Aviva will only allow an increase of €40,000 while Zurich, Royal London and New Ireland go up to €100,000. But, Aviva will allow you to extend the term too if you are getting a new mortgage, the other insurers will only allow you to increase your amount of cover. With those insurers, if you feel you will need to extend your term in the future, you should add the conversion option.
I know yeah: as a dad, this one always gives me the heebie-jeebies. But if you have kids, Children’s Life Cover is a consideration whether you like it or not. In descending order:
You should also take a look at how much children’s Serious Illness is included for free. So again, from the top:
This stops your premiums if you’re out of work due to illness/accident. Zurich is the only one here who offers it, and it kicks in after 13 weeks. Honestly, this could be a lifesaver, so don’t dismiss its significance. With the other insurers, you can add a Waiver of Premium, but it’ll cost you extra.
If your premiums are north of €100 per month, the waiver of premium looks even more attractive
This is a bit of a funny one because of the name (most deaths, you might be thinking, must be accidental?) but it is useful in some instances. Basically, if you die because of an accident before your policy issues but after your insurer receives your completed application form, your family will get a payment of up to €150,000.
Royal London doesn’t offer it.
Access to an independent review of your diagnosis and treatment plan. A second medical opinion, basically. Free via Aviva and Irish Life.
Basically: if you forget/can’t make a payment and your policy is then cancelled, the insurer gives you the option to pay the arrears within a certain time. If you do they’ll put you back on cover or even payout if a death had occurred when premiums were missed.
This little bad boy is the dirty secret of insurance. Most people end up with a joint policy, which pays out on the first death. Dual Mortgage Protection pays out on both. That’s two payments. The bank would get the first payment to clear the mortgage; the second would go to your family.
It’s an excellent way of getting Life Insurance for cheap, basically.
There are a couple of extra benefits as well, though you’ll have to pay for them:
Here the insurer agrees to clear the outstanding balance on your mortgage regardless of interest rates.
Yeah, I bet you didn’t know this was a thing you might have to worry about.
Without this guarantee, there might be a balance leftover to be paid (if your mortgage interest rate creeps above 6 per cent) before your bank officially gives your other half/family the house.
With a conversion option, you can turn your Mortgage Protection into a Life Insurance policy. Handy.
All the insurers bar Aviva offer this benefit for extra moolah.
If you’re in perfect health, you can choose any insurer.
Truthfully, I rarely see an application that doesn’t have some health condition or family history of a health issue. In that case, the most important thing is to choose the insurer that is most sympathetic to your particular situation. Forget about the bells and whistles. You need to find an insurer who will offer you cover at the lowest price with the least amount of hassle.
That’s where we come in. We’re the experts if you have a pre-existing condition.
The first thing you should do is complete this medical questionnaire so I can find you the most suitable insurer.
With all that in mind, what you do will depend on your circumstances and any other insurance policies you might have. As you can see from this big ole list, it can get quite confusing with lots and plusses and minuses.
However, I stand by my advice: take a look at the cost first. Then look at the list of nine benefits and choose the ones that you think are important. Rank ‘em by most relevant. From there, scroll back up and see who comes out on top.
If you find that your brain starts to melt out of your ears, you can fill in this short form or give me a buzz on 057 93 20836, and I’ll get back to you.
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