can self employed people have mortgage protection?

Eligibility for Self-Employed Individuals

• Availability: Mortgage protection insurance is available to self-employed individuals, but you may face stricter criteria compared to someone who is employed full-time by a company. This is because self-employed income can be more variable and may be considered higher risk by insurers.
• Proof of Income: Insurers will typically require proof of your income over a set period (usually 1 to 3 years). This is often done by reviewing your tax returns, accounts, or SA302 forms (a summary of income from HMRC). The stability and consistency of your income will be a key factor in determining eligibility.

Types of Mortgage Protection Available

• Accident and Sickness Cover: This covers your mortgage payments if you are unable to work due to illness or injury. As a self-employed person, this type of cover is particularly important because you might not have access to sick pay.
• Accident, Sickness, and Unemployment (ASU) Cover: Some policies also include unemployment cover, which may be available to self-employed individuals. However, it’s crucial to check the terms and conditions, as unemployment cover for self-employed individuals may be limited or have specific exclusions.
• Income Protection Insurance: While not specifically mortgage protection, income protection insurance can provide a broader safety net. It pays out a portion of your income if you are unable to work due to illness or injury, which can then be used to cover mortgage payments and other expenses.

Policy Considerations for the Self-Employed

• Waiting Periods: Self-employed individuals should pay attention to waiting periods, also known as deferment periods, which is the time you must wait after becoming unable to work before the policy pays out. Common waiting periods are 30, 60, or 90 days.
• Exclusions: Self-employed individuals should carefully review policy exclusions, particularly around unemployment cover. Some policies may not cover self-employed job loss, or they may have stringent requirements to qualify.
• Premium Costs: Premiums may be higher for self-employed individuals, reflecting the perceived higher risk due to income variability. However, the level of coverage you choose and the length of the waiting period can influence the cost.

Choosing the Right Policy

• Specialist Providers: Some insurers specialize in offering policies for self-employed individuals. It may be beneficial to work with a broker or financial adviser who understands the needs of the self-employed and can help you find a suitable policy.
• Customising Coverage: Ensure the policy is tailored to your specific needs, such as including income protection or selecting a policy with a suitable waiting period and coverage level that aligns with your business’s financial stability.

Conclusion