Research by insurance broker Drewberry Personal indicates that over half of mortgage borrowers taking out mortgage payment protection insurance fail to insure any more than their basic monthly repayment level, which is leaving thousands significantly under-protected.
Although with most MPPI plans it is possible to add additional cover for non-mortgage-related costs such as utility bills, council tax and other household expenses, this is not being taken up.
Drewberry found that only 52% of individuals and couples insure their monthly repayments, with no additional protection for other essential monthly costs.
This is a sorry state of affairs, as while the protection of mortgage payments is important, it is unlikely to be consumers’ only financial commitment.
This means other monthly costs will have to be met by savings, borrowing from friends and family or turning to overdrafts and credit cards.
This highlights the importance of consumer choice and policies must be seen to be adaptable to include what customers identify as their major financial priorities.