Mortgage Protection

• A Mortgage Protection Plan is also known as “Decreasing Term Insurance”. You pay us regular monthly premiums during the term of the plan. The premiums do not vary during the term of the plan.  
• The benefit you receive reduces in line with the capital outstanding under a repayment mortgage. There is no benefit if you survive to the end of the term.
• So at the beginning of the term the entire outstanding mortgage balance is covered. As the mortgage is repaid the benefit to be paid out decreases. This has the effect of making the Mortgage Protection Plan far cheaper than other forms of life insurance.
• There is no surrender value – if you stop paying premiums the cover will simply cease.
• If critical illness cover is included in the plan, the benefit will be paid if an insured person is diagnosed with a defined critical illness (see FAQs). There is then no further benefit paid on death. If critical illness cover is not included in the plan, then the full benefit will only be paid on death, or if an insured person is diagnosed with a terminal illness with death expected within 12 months (see FAQs).

• If only one person is covered by the plan: on death during the term of the plan.
• If two people are covered by the plan: on the death of the first to die if this occurs during the term of the plan.
• If critical illness cover is included in the plan: on diagnosis of a critical illness.
• If critical illness cover is not included in the plan: on diagnosis of a terminal illness (with less than 12 months to live), but not in the final 24 months of the term of the plan.
• After any payment the plan immediately expires and cover ceases.

• If you do not disclose relevant information on your application form.
• If you do not tell us of any of the following changes that occur after completing your application form but before cover starts:
  • Your health
  • Starting smoking
  • Use of drugs or alcohol
  • Hazardous pastimes
  • If death occurs due to suicide during the first year of the plan.
  • If you cancel the plan or if any premiums are more than 30 days overdue (60 days for payroll deductions).

Critical Illness Cover

The complete list of conditions we cover is set out below.

These headings are only a guide to what is covered. The full definitions of the illnesses covered and the circumstances in which you can claim are given in the policy document, (click the relevant button on the right). These typically use medical terms to describe the illnesses but in some cases the cover may be limited. For example: Some types of cancer are not covered, and to make a claim for some illnesses, you need to have permanent symptoms.

The policy document gives full details of the cover provided and includes all the definitions, exclusions, terms and conditions. Specimen copies are available here Single Life Mortgage Protection (NO Critical Illness), Single Life Mortgage Protection (WITH Critical Illness), Joint Life Mortgage Protection should you wish to see them before making your decision. Additionally, the Money Advice Service™ provides useful financial information on its website moneyadviceservice.org.uk. However, if you are still unsure as to the suitability of this plan, and wish to obtain personal advice, you should contact an independent financial adviser.

Your monthly premium depends on the amount of cover you choose, how long the plan is to run for (its “term”), and whether critical illness cover is included. It also depends on your personal circumstances – your age, health, sex, and whether or not you smoke.

Example Illustrations

The tables below show example monthly premiums for our Mortgage Protection Plan (Decreasing Term Assurance) – a plan with reducing benefits. The premiums are based on a sum assured of £100,000 over 25 years and assume you are in good health at the time of commencement and are accepted at standard rates.

Death Benefit only – no Critical Illness Cover

Death Benefit PLUS Critical Illness Cover

The premium includes all costs for administration, underwriting and claims.

If you are a member of the Metropolitan or City of London Police Services the premiums are paid by salary deduction, otherwise payments are made by direct debit.

Critical illness benefit (if applicable) would be paid to you, and if this remains in your possession at your death, it will form part of your estate and be subject to Inheritance Tax. If you give any of this benefit away as a gift, and do not survive for at least seven years after making the gift, then on your death your estate may be charged some level of Inheritance Tax on those gifts, although there are some reliefs which may apply.

Any death benefit would be paid into your estate, and therefore may be subject to inheritance tax. Assets left to your legal partner (or to charity) are not normally subject to Inheritance Tax.

If the plan is placed in Trust, or assigned (to a lender or another individual), it may not form part of your estate. Please see our basic guide to trusts for details of the Trust Deed we have available for our life insurance plans. Taxation treatment may be subject to future changes in legislation.

• You can cancel for a full refund within 30 days of receiving your policy documents.  Simply contact our Member Services team on 01689 891454 or email [email protected] 
• If you wish to stop or cancel your plan after this, our friendly Member Services team will be able to help.

Metfriendly, Central Court, Knoll Rise, Orpington, BR6 0JA

Phone: 01689 891454

Email: [email protected]