The Average Cost of Mortgage Protection in Ireland

Mortgage Protection is compulsory for anyone buying a residential property in Ireland.

Luckily, premiums are somewhat inexpensive. Unless you’ve purchased your policy through your lender (your bank). In that case, the premiums may be slightly more expensive (long story). 

Although we say slightly more expensive, a slightly more expensive premium over 25 or 30 years can be significant.

Even a €10 difference in premium over 30 years would mean you’re paying an additional €3,600.

I’m sure we could all think of better things to spend that money on than a more expensive monthly premium.

If you’ve bought your Mortgage Protection through your bank it may be time to shop around. You’ll likely get more comprehensive cover at a cheaper price elsewhere.

Although this guide isn’t about why you should choose a broker over a bank for Mortgage Protection

We’re here to look at the average cost of a Mortgage Protection policy.

Without further ado…

Average cost of Mortgage Protection

When looking at the average cost we’ve to assess both joint and single applicants.

Although the majority of people apply for a mortgage as a couple, there will be some who’ll apply alone.

We’ll look at the average cost for both scenarios.

Average cost of Mortgage Protection for joint applicants

According to reports , the average age of joint purchasers in Ireland is 38.

This means the average Mortgage Protection policy will cost €34.77 per month.

average mortgage protection joint applicants

The above quote is for €300,000 cover over a 25-year term. We also assumed the couple had no major underlying health issues.

This quote was from Royal London and is a Dual Life Mortgage Protection policy.

Why is the dual part important? Glad you asked.

When taking out Mortgage Protection as a couple, you’ve two options.

Joint Life Mortgage Protection – this policy pays out when the first policyholder dies and will clear the outstanding mortgage.

Dual Life Mortgage Protection – a dual life policy pays out when the first policyholder dies and clears any outstanding mortgage. However, cover continues with the surviving policyholder and will pay out again should they die within the term.

Essentially giving you double the cover for the same price. With a dual policy, the cover will be the same on both lives.

Please note box – Banks do not offer Dual Life Mortgage Protection. To avail of this cover, you must take out Mortgage Protection through a broker.

Average cost of Mortgage Protection for a single applicant

Yes. Mortgage Protection is compulsory for anyone purchasing a residential property in Ireland.

Although there are exceptions in certain circumstances.

There are also those who’ll be applying for a mortgage as a single applicant. The average cost of Mortgage Protection for a single applicant is €24.69

To keep things uniformed, we’ve used the same criteria as above. A healthy, 38-year-old who does not smoke.

The policy term is 25 years and the sum assured is €300,000.

What affects the cost of a Mortgage Protection policy?

As with any insurance policy, there will be certain factors that affect the cost of your monthly premium, and Mortgage Protection is no different.

The following are the key variables that will impact the cost of your premium

  • Whether it is a single, joint of dual policy
  • The age of the applicant(s)
  • Smoking status
  • The sum assured (amount of cover you need)
  • The length of the policy term
  • Any pre-existing medical conditions
  • Conversion option

Other factors that may increase the cost of Mortgage Protection

As well as those outlined above, there are other factors that may affect the cost of your premiums.

These will vary depending on your situation but are worth looking at in more detail.

BMI

If you have a higher-than-average body mass index (BMI), your premiums may increase,

Anyone with a BMI higher than 30 could see their premiums ‘rated’. This will increase premiums by an agreed percentage.

Unless it is a severe case, most premiums will be increased by approximately 50%.

Premium ‘rated’ due to high BMI

Original Monthly Premium

€60

New Premium – rated 50%

€90

It is worth noting some insurers are stricter than others. Where one insurer may increase your premium by 50%, another could increase it by 75% or 100%.

Enlist the assistance of your broker and ensure you are getting the best deal possible.

Comparing the market is important as insurers will have different criteria.

Conversion option

Choosing a conversion option on your Mortgage Protection policy will increase your premiums.

However, this does not mean it’s something you should avoid. It’s advisable to include a conversion option as it gives you the flexibility to amend your cover in the future regardless of your health.

Plus, the cost of adding a conversion to your policy is minimal.

Mortgage Protection Premium

Without Conversion Option

€24.06

With Conversion Option

€25.11

The above is for a single applicant applying for €300,000 over 25 years.

Vaping

Vaping has become extremely popular as of late.

However, vaping is considered the same as smoking. Therefore, it will affect the cost of your premiums.

You must have quite 12 months or longer to qualify for non-smoker rates.

Which provider should you choose?

As with any insurance policy, the provider you choose will have an impact on the price of your premium.

At emero, we aren’t tied to a single provider allowing us to compare the market.

However, price isn’t the only important factor. Although price will play a role, not all Mortgage Protection policies are not created equal.

Different providers will offer different additional benefits.

Let’s first look at a price comparison. After this will look at additional benefits and why they are important.

We can see by taking the average of Level Mortgage Protection the monthly premium is €24.69.

The cheapest including a conversion option is €24.02 while the most expensive is €31.73

The average premium including a conversion option is €26.90.

We can see from above that the average price of Mortgage Protection per month is quite reasonable. We could also recommend taking the conversion option.

For the sake of approximately €2 extra per month it is well worthwhile.

The other aspect when choosing a provider is the free additional benefits offered.

For example, Royal London offers Dual Mortgage Protection for the same price as Joint Mortgage Protection.

This means you’ll essentially get double the cover for the same price. It’s knowing simple facts such as these that make it worthwhile going to your broker rather than a bank.

Banks are limited and tied to a single provider.

What provider offers the best Mortgage Protection?

As we touched on earlier, we aren’t tied to a single insurer and have no allegiance to one.

This allows us to take a step back and compare the market without any biases. However, we do feel Royal London’s Mortgage Protection is a really good offering.

They offer a very good service combined with a solid product. At a glance some reasons to consider Royal London would be:

  • Pricing – very competitive on the price of premium and willing to match the lowest on the market
  • Double the cover at no additional cost – Dual Life for the same price as Joint Life
  • One month’s free cover – your cover will kick in immediately but your payments do not start until the first month has passed
  • Conversion option – the ability to convert your policy for a 5% additional premium

They also offer other additional benefits such as their Helping Hand support. This gives policyholders one-to-one personal support from a dedicated nurse from RedArc who can help cope with stress from illness or bereavement.

A combination of all of these is why we often recommend Royal London to clients looking for Mortgage Protection.

This may change in the future but as of October 2022, this would be our preference.

What should you do next?

Hopefully, this guide provided you with clarity. As with anything, knowing the averages and what others pay is always beneficial.

If we were to summarise, we’d recommend keeping a couple of important points in mind.

  • Explore your options – do not automatically go with your bank. Compare the market and see what different providers have to offer. What seems like a trivial amount could save you a lot of money in the long run.
  • Don’t be afraid to switch – switching Mortgage Protection provider is likely a lot easier than you think. Speak to your broker, assess your options and complete the paperwork. It’s a painless process.

If you’ve any questions or need assistance we’d be more than happy to help.

You can contact myself or any of our team via phone or email.

<b>Ian Kennedy QFA</b> <br>Senior Financial Advisor</br>
Ian Kennedy QFA
Senior Financial Advisor

Ian is one of our Senior Financial Advisors at emero and has worked within the financial sector for the past five years. If you would like to chat with Ian directly, please get in touch with him at 

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Providing specialised advice.

Phone: 01 963 0436

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