Mortgage cover to cost even more
THE GUARDIAN - 4TH SEPTEMBER 2004
Nationwide has surprised critics by increasing the cost of its mortgage payment protection insurance amid widespread concern about the profit margins on this product.
Jobs & Money recently highlighted the 70% margins that banks are earning on payment protection insurance policies, which are also hemmed in with restrictions on claiming. Most consumers can reduce their premiums by a third by avoid the high street banks.
Last Thursday Nationwide upped its mortgage payment protection insurance premiums by an average of 8% - 12 months cover for accident, sickness and unemployment now costs £5.39 a month for each £100 of cover. The premium has risen from £4.99.
Nationwide customers who take out the same cover for two years will in future pay £6.47 a month – up form the old monthly premium of £5.99.
Most people who buy mortgage payment protection insurance cover will be far better off if they take cover form one of the specialist providers. A recent survey by Burgesses suggested that Britons are collectively overspending £7 billion by not shopping around for mortgage payment protection insurance cover.
Its own Mortgagesafetynet accident, sickness and unemployment package currently costs £3.95 per £100 of monthly benefit compared with an average £5.78 from high street sources.
