Any insurance is better than no insurance.

For a time there it seemed that obtaining a mortgage was about as difficult as getting the latest debit card from the local department store and with this in mind people approached this phenomenon with great gusto. But what about insuring that mortgage?

Now that the credit crunch has taken hold, the world of finance has been shaken and interest rates are fluctuating in a very erratic way. Mortgages, once seen as an easy touch, are rising, in some cases up to 100%, and unforeseen circumstances in a person’s life could easily lead to the inability to meet the payments. And all because the idea of insurance was not given consideration.

Now is the best time to take control. Remember, insurance is not about the risk of something happening, it is about taking out cover to help you out after something damaging happens. A lot of people take issue with taking out life insurance because they think to themselves “I’m perfectly healthy, so why do I need insurance?” The truth is, this is the best time to take out life insurance because you are in peak condition and the premiums will be lower. The other truth is, although you may be a picture of health right now, it is impossible to predict what may happen and unfortunately even healthy people get ill. The important thing is to be prepared for that possibility and protect yourself against it.

So what do you need to consider? Well, first and foremost you will need to make sure your mortgage is covered if you have one. If it is a repayment mortgage you have, the cover you need is a mortgage protection plan. If you have an interest only mortgage, it is a level term plan you need. Another extremely beneficial extra you should consider is critical illness cover. This will guarantee to pay off your mortgage for you should you contract a critical illness, such as cancer. This can be extremely helpful in troubled times, and if you recover from your illness, you can still rest assured that your mortgage has been paid off anyway.

Payment protection is another factor which should also be taken into consideration. This will protect your actual mortgage payments against the eventuality of you being off sick or made redundant. Unfortunately redundancy has become more of a possibility for more of us as companies are having to make severe job cuts in order to survive. Payment protection policies tend to pay out for between 12 and 24 months, so if you have to go off sick or are made redundant, this can make the difference between keeping and losing your home.

You should also make sure that you look at life cover for your family in the event of your death. It is one thing to have your mortgage covered in the event of your death, but it is worthwhile considering the bills your family will have to go on paying after you have gone.

Family income benefit would probably be the most suitable sort of policy to enquire about. The way that this policy works is that it covers the income of the policy holder and pays out on a monthly or yearly basis should the worst occur. You can then be assured that your family is financially taken care of in the months and years ahead. I know that this can sometimes sound very morose but it is something that should be considered.

So to summarise now is the time to be reviewing all your financial affairs not least anything to do with mortgage and loans. You need to put a far greater emphasis on protection in these hard times as it is these times that hurt the most should the unthinkable actually happen. It is always best to seek some sort of professional advice for this process, such as an independent financial advisor as these people are qualified to consider what might happen and protect against it.