Getting cheaper protection
- 26TH MAY 2007
There has been much negative publicity about payment protection insurance (PPI) and it has been called the biggest “scam” ever. However there is no denying that if sold properly, it provides an invaluable financial safety net. Payment protection insurance is bought when you take a loan, credit card or mortgage to safeguard the monthly repayments should you find yourself out of work due to prolonged illness, accident or involuntary redundancy.
In order to get the best deal on your insurance, you do need to shop around. It is not compulsory to buy it from your bank or lender alongside a loan, mortgage or other credit. You are free to buy it independently.
When choosing cover, research it thoroughly. There are many hidden exclusions within the policies which means that you have to meet certain requirements in order to claim on the product. If you are a part time worker or retired, then you would be ineligible to claim, as an example. If you are self employed then you should also look into the exclusions very carefully as many insurers require you to have gone in to liquidation before you can claim.
If you are self employed, you would not be able to claim, for example, if you broke your arm and couldn’t work for a month, which you would expect you could.
Also, common problems and illnesses are usually excluded from the policy. These can include back problems, nervous illness and medical problems which already exist when you take out the policy.
If you need payment protection insurance or mortgage payment protection insurance then shop around. Never take the banks’ cover; this is the most expensive way of purchasing insurance. Independent specialist payment protection insurance provider British Insurance is one of the cheaper providers and can save you up to 40% on a mortgage payment protection policy and up to 80% on payment protection insurance.
