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When do you Start Your Mortgage Protection Policy?

when should you apply for mortgage protection?

Timeline for Arranging Mortgage Protection:

A question we received from a client inspired this here blog:

We don’t have an agreed closing date for the sale yet, we’re still waiting on the first draft of contracts. Is it too early to start the ball rolling on mortgage protection? We’re hoping to get everything done and keys by the end of next month”

How long it takes to get mortgage protection depends on several factors:

  1. your health
  2. how much cover you need and your age
  3. how efficient your GP is

Let’s look at your health first:

You’re fit as a butcher’s dog, hallelujah – glad to hear it, you’ll have no issue getting cover quickly, assuming you don’t fall foul of the cover/age pitfall that I discuss below.

Let’s say you apply for mortgage protection today; we’ll have your policy within a couple of days – sooner if you REALLY need it!

However, if you have any health issues that may require a medical report from your GP, you’re looking at anywhere between 4-6 weeks to get cover, so if your mortgage drawdown is in the next couple of months, you should get cracking asap.

Why the amount of cover you need and your age can delay mortgage protection:

Insurers have these fancy yokes called “non-medical limits”.

In plain English,  this means the older you are, the less cover you can get without the insurers needing additional medical information.

A 45-year-old with no health issues can get €600,000 Mortgage Protection based on an application form. The insurers would request a 47-year-old attend a nurse medical screening if they needed the same cover.

Fortunately, all the insurers have different non-medical limits, so just because Irish Life has requested you to do a nurse medical, we might be able to get your cover based on an application form only.

So, if you’re 40+ and need substantial cover, make sure to shop around if you want to avoid a nurse prodding and poking you.

How quickly does your GP send back medical reports:

As above, on average, we are finding it is taking 4-6 weeks for a GP to send back your PMAR (Private Medical Attendants Report). Some GPs are much more efficient, and if your GP is on the ball, they could send it back within days.

However, with some GPs, your future will look like this:

Day 1 – the insurer requests the PMA by post

Day 5 – you follow up with the GP, the GP says the insurer never sent it

Day 6 – the insurer sends the PMA by post and fax

Day 9 – you finally get through to your GP, who confirms receipt

Day 13 – the GP requested prepayment from the insurer before they will complete the PMAR

Day 20 – prepayment made

Day 27 – you chase the GP

Day 36 – GP sends back your full report to the insurer (100s of pages)

Day 40 – after trawling through the full report, the insurer has to write back to the GP for further information

Day 44 – GP says they never received this request

Day 47 – Insurer sends the request by fax and post

Day 60 – GP writes back to the insurer

Day 61 – insurer has all the required information and makes a decision

You might think I’m exaggerating but this, unfortunately, is a common timeline, especially at busy surgeries.

Take it from me. If your GP requests prepayment before completing the PMAR, then I’m sorry to say you’re in for a long wait. 😐

When should you start your mortgage protection policy?

So, let’s say you’ve gone through the whole underwriting process, and the insurer has offered you cover.

What next?

Well, you can either start your policy immediately or ask us to hold your policy until you have a start date.

Start your policy immediately.

In this case, the insurer will issue your policy documents immediately, noting your mortgage drawdown date, AKA the start date. So you’ll be “on cover” immediately (if you die, the policy will payout), but you won’t be able to draw down your mortgage until the start date of your policy.

e.g

The insurer issues your policy on July 9th with a start date of July 29th. You won’t be able to draw down your mortgage until July 29th, but you will have the policy documents to the bank in plenty of time.

By the way, most insurers will give you one free month’s cover so you don’t need to worry about paying premiums for a while!

Hold for your start date (also known as Hold for Risk Commencement Date)

Here, we hold your policy until you give us the go-ahead to activate it.

The caveat is that you must disclose any new health issues that may arise between the date the insurer accepts you for cover and the date you start the policy.

e.g

The insurer offers you cover on July 9th, but you’re not due to draw down your mortgage until August 29th.

On the 25th of July, you visit your GP. You must notify the insurer about this GP visit, and the insurer can revoke your cover. 😕

We recommend starting your policy in advance to avoid any unforeseen medical issues screwing things up at the last minute for your peace of mind!

Related Topics:

What if you can’t get mortgage protection?

Do you always need life insurance for a mortgage?

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Next Steps

If you’re due to drawdown on your mortgage in the not too distant future and would like to sort out your cover in advance, I’d love to help.

Please complete this financial questionnaire, and I can recommend the best insurer for you.

Alternatively, if you’d prefer a call first, you can schedule a callback here.

Talk soon!

Nick

Mortgage Protection Insurance
Give us a quick outline of how we can help and we'll be right back to you.

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