There are two types of mortgage insurance. The first is Term insurance. This is insurance that is paid every month and in the event of your death, your partner or children will still be able to live in the house and the mortgage will be paid off on your behalf. Every month the amount of cover decreases as you have paid off more of your mortgage with your monthly payment. If you pay off your mortgage in the end, the policy just expires without the company having to pay out.

The second type of mortgage insurance is Mortgage Payment Protection Insurance. This covers your mortgage payments if you should become unemployed due to redundancy, illness or an accident.

Both of these types of insurance are recommended when taking out a mortgage.