A new online service which could help homeowners save nearly €400 a year on their mortgage protection insurance was launched yesterday. By Christian McCashin
Price comparison website Bonkers.ie launched the service for homeowners to compare the cost of the insurance.
Compulsory by law, it is one of the least switched services in the country. Nearly half - 48% - of households have never shopped around for cheaper mortgage protection insurance and 1 in 20 homeowners switch for a better deal each year, despite the savings available.
Yet in shopping for car insurance nearly all drivers compare quotes with rival companies as they renew each year.
“Bonkers.ie guarantees a market-beating quote based on its decision to waive commission fees and additional charges. Customers will also benefit from a team of qualified financial advisers, who will guide them through their mortgage protection insurance decision," a spokesman said.
“Additionally, customers can compare and switch life insurance and serious illness cover through the new service." Most the country's 740,000 mortgages take gut their policy directly from their lender without shopping around, putting them at risk of overpaying.
Bonkers.ie boss David Kerr said: ‘For the past six years, we have been on a mission to help households save money by highlighting the substantial benefits of switching. Mortgage protection insurance is the sleeping giant of household savings with only a tiny number of Irish consumers taking advantage of the savings available.
"We’re delighted to shine a light on the savings available to Irish consumers and to help them save on one of the least-switched products in the marketplace."
The new service, provided in partnership with Low.ie, offers a lowest-quote guarantee which allows customers to make substantial savings. And Simon Moynihan, of Bonkers.ie, said: “You need to have mortgage protection insurance in place at the time of drawing down your mortgage, it's a requirement. “
The bank is the beneficiary of your mortgage protection. If you get hit by a bus it doesn't go to your partner it goes to the bank.
“Most people take it out as a joint policy. It's usually about one and-a-halftimes what it costs for a single person because the risk is greater that one or other of the people may die
"But if you die your partner is not the recipient, it goes to the bank to clear the mortgage. It's really the bank protecting itself."
The average non-smoking household can save €190 annually by switching mortgage protection insurance but annual savings of up to €379 are available to Irish households with smokers, Bonkers.ie says.