Mortgage payment protection insurance (MPPI)

MPPI pays your monthly mortgage payments while illness or unemployment stops you working. HMRC says these policies usually pay for one or two years at most. They're often called accident, sickness and unemployment (ASU) policies.

MPPI generally covers your mortgage repayments rather than your wider income. Some policies pay an extra sum towards other household bills as well.

It covers your mortgage repayments if an accident, sickness or involuntary unemployment stops you working. With Best Insurance's Standard Mortgage Insurance and Paymentshield Mortgage Protection, you choose one of three cover levels:

• Accident and sickness only, for when an accident or illness stops you working.
• Unemployment only, for losing your job when you didn't choose to. Both policies include carer cover too, if you give up work to become a carer.
• Accident, sickness and unemployment together.

Redundancy and unemployment exclusions

Unemployment cover is for job loss you didn't choose. Standard Mortgage Insurance won't pay if you take voluntary redundancy, permanently retire or resign. Paymentshield excludes resignation, retirement, voluntary redundancy, dismissal for misconduct and payment instead of working.

Neither policy covers a job loss you knew about, or knew was likely, before cover started. Both also limit unemployment claims in the first 90 days:

• At Standard Mortgage Insurance, you can't claim if you're told about or made aware of a risk of unemployment in the first 90 days. The same applies to a carer claim if, in those 90 days, you learn of circumstances that might lead you to give up work to become a carer.
• At Paymentshield, existing borrowers (whose mortgage has run for more than 30 days at the start date) aren't covered if told of unemployment, or made unemployed, in the first 90 days. This exclusion doesn't apply if you're transferring similar unemployment cover.

If you're self-employed, Standard Mortgage Insurance requires satisfactory evidence that your business has ceased to trade. Paymentshield covers self-employed unemployment if your business has permanently ceased trading because you couldn't find enough work to meet reasonable business and living expenses, and you've declared this to HMRC.

How the two policies compare

Paymentshield's policy also includes up to £50,000 of employment legal protection for any one claim. It covers legal costs for taking action against a third party for personal injury, or against your employer for discriminatory action under the Employment Tribunals Act 1996.

Pre-existing conditions and medical evidence

Both policies exclude pre-existing medical conditions (health problems from before the cover started), though the exclusion ends after 12 symptom-free months:

• Standard Mortgage Insurance excludes any condition or symptom (diagnosed or not) that you had advice, treatment, medication or a consultation for in the 12 months before cover started. It also excludes anything you knew about, had symptoms of, should reasonably have known about, or saw or arranged to see a doctor about in that time. The exclusion ends after 12 continuous months without symptoms, medical advice or treatment.
• Paymentshield excludes conditions you knew about (or should reasonably have known about) at the start date, or saw or arranged to see a doctor about in the 12 months before. The exclusion ends once you've been symptom-free for at least 12 months after the start date without consulting a doctor or having treatment for it.

At Standard Mortgage Insurance, mental health claims (such as anxiety, depression or stress) are only paid if a consultant diagnoses the condition and certifies you can't work solely because of it. Back claims need radiological evidence (such as an X-ray or scan) of an abnormality or injury, confirmed by a doctor or consultant. Paymentshield excludes pregnancy or childbirth unless there's a medical complication.

MPPI usually pays out for one or two years at most. MoneyHelper describes policies covering your payments for 12 months after a waiting period of one to three months.

Standard Mortgage Insurance pays up to 12 monthly payments per claim, while Paymentshield pays for up to 12 or 24 months depending on the benefit period you chose. MoneyHelper notes you might pay premiums for many years, only to find some policies pay out for a short time, typically one year.

Waiting periods: back to day one vs excess

The waiting period (called the claim waiting period at Standard Mortgage Insurance and the qualification period at Paymentshield) is how long you must be off work before a claim pays. MoneyHelper says there's nearly always a gap of about three months before payments start.

• Back to day one: once you pass the waiting period, the payout is backdated to the start of your claim. With Paymentshield's 30-day qualification period, the first payment is made 31 days after the claim start date, backdated to day one. Standard Mortgage Insurance also pays your first monthly benefit after 30 days in a row off work.
• Excess: you're paid only for the time after the waiting period ends. With Paymentshield's 30-day excess option, your first payment is made 61 days after the claim start date (or 211 days with a 180-day qualification period). With Standard Mortgage Insurance's 30-day or 60-day excess options, benefit builds up at 1/30th of your monthly amount for each extra day off work.

When you choose a waiting period, think about what you'd live on in the meantime. The Financial Ombudsman Service says people usually try to match an income protection deferred period (the wait before it pays) to the sick pay they get. If you're an eligible employee, your employer pays Statutory Sick Pay for up to 28 weeks when you're too ill to work, though it won't help if you lose your job.

If you receive, or are entitled to receive, payment in lieu of notice (pay instead of working your notice), a Paymentshield unemployment claim, including its qualification period, doesn't start until your notice period ends.

How a claim works

1. Report the claim early MoneyHelper says to claim as soon as you stop working or lose your job. Standard Mortgage Insurance requires you to report a claim within 30 days of being off work.
2. Complete the waiting period You must be unable to work for the full period you chose. At Paymentshield, that means more than 30, 60 or 180 days.
3. Provide ongoing evidence Under Standard Mortgage Insurance, you must keep showing that you're still unemployed, a carer or off work through accident or illness throughout your claim.
4. Receive monthly benefits until the claim ends Paymentshield pays the monthly benefit directly to you. It stops when your unemployment ends, you're fit to work again, you stop being a carer, you reach the maximum number of monthly payments, or your mortgage is repaid.

MPPI usually pays your mortgage for one or two years at most, while income protection replaces part of your income and can pay for longer. The Financial Ombudsman Service says payment protection insurance usually only provides short-term benefits.

Income protection pays a regular amount if illness or an accident stops you working. It can keep paying until you return to work, retire, die or reach the end of the policy term, whichever comes first.

Short-term income protection (STIP) sits between the two. It replaces a proportion of your income, usually 50% or 60%, for a fixed period (usually 12 or 24 months) and isn't tied to a debt. Best Insurance's Best Income Insurance is one such policy: it pays up to £3,000 a month or 65% of your gross monthly income, whichever is lower.

Some lenders can help by changing how you pay, and if you get certain benefits you may be able to get Support for Mortgage Interest (SMI). SMI is a government loan towards the interest on the mortgage for the home you live in, which you repay with interest when you sell or transfer ownership of your home.

• Who can get it: you must have a mortgage or home improvement loan for the property you live in and receive Universal Credit, Pension Credit or income-related Employment and Support Allowance (ESA). There's no guarantee you'll get SMI for a mortgage you take out.
• When payments start: after 3 months in a row on Universal Credit, or 39 weeks in a row on income-based ESA. On Pension Credit, payments can start from the date your Pension Credit begins.
• How much is covered: SMI usually helps pay the interest on up to £200,000 of your loan or mortgage, or up to £100,000 in some cases, such as if you get Pension Credit. The interest rate used to calculate SMI was 3.66% when checked on 2 October 2026.
• How it's paid and what's excluded: SMI is normally paid direct to your lender. It can't pay towards insurance policies or missed mortgage payments (arrears).

The FCA brought in rules so people who complained about mis-sold PPI were treated fairly, and you can still buy PPI and short-term protection today. PPI was sold from the 1970s, most heavily between 1990 and 2010, alongside mortgages, loans, credit cards and store cards.

While PPI helped some people, the FCA found widespread poor sales practices. Policies were sold too widely to people who didn't need them, and sellers often took unfair commission. Over £38.3 billion had been paid in refunds by April 2021, following a 29 August 2019 deadline for complaints to the firm that sold the policy.

That deadline doesn't apply if you bought PPI after 29 August 2017. It also doesn't apply if you bought PPI before that date, the policy was still in force on 29 August 2017, and your complaint is about a claim rejected for ineligibility, an exclusion or a limitation. Complaining yourself is free and simple. Companies that complain for you charge a fee, and the FCA says to treat anyone who offers to get you a PPI refund with caution.

Whether MPPI is worth it depends on your work, your savings and whether the exclusions would block a claim. Citizens Advice warns there are many circumstances where a payment protection policy won't pay out.

When we checked in October 2026, Paymentshield published a typical monthly cost of £5.05 for every £100 of monthly benefit, including Insurance Premium Tax at the present rate. That figure is based on full accident, sickness and unemployment cover with 30-day back-to-day-one cover, 12 months' benefit and no deferred premium payment period, protecting a £620 monthly repayment. Before you buy, check these points:

1. Whether you already have cover Because of how payment protection was sold in the past, MoneyHelper suggests asking your lender whether your mortgage is already covered. Paymentshield reduces your benefit during a claim if another policy also covers your mortgage repayments.
2. Whether your work qualifies MoneyHelper warns that many payment protection policies won't cover part-time, self-employed or temporary workers. Both policies above require at least 16 hours' work a week and exclude temporary work. Paymentshield also excludes unrenewed fixed-term contracts unless you've worked continuously for the same employer for at least 12 months.
3. Whether your job is already at risk You won't be able to claim if redundancies have already been announced or rumoured. Paymentshield won't cover you if your employer has warned, formally or informally, that your job is at risk, or has announced workforce cuts. Standard Mortgage Insurance requires that you aren't aware of any redundancies, restructuring or financial threats where you work (or, if you're self-employed, of reasons your business is likely to close).
4. How much it pays and how joint cover works Standard Mortgage Insurance caps payouts at the lowest of £2,500, 65% of gross monthly income or your mortgage payment. Paymentshield caps them at the lower of £3,000 or 75% of monthly earned income. On a joint mortgage, Paymentshield lets you split one policy's benefit between you, or take two separate policies if you each want 100% cover.
5. Whether premiums can change and continue during a claim Standard Mortgage Insurance bases premiums on your age and changes them at the first renewal after you enter a new age band. Paymentshield can change payments, cover and terms at any time with at least 30 days' notice. Standard Mortgage Insurance requires you to keep paying premiums during a claim. Paymentshield asks you to keep paying too, and pays them back by increasing your monthly benefit.
6. What happens if your mortgage changes Standard Mortgage Insurance requires you to tell it if your monthly mortgage payment falls by more than 20% of the monthly benefit, or if you redeem your mortgage. Paymentshield reduces the benefit during a claim if your mortgage payment has fallen below the amount in your documents, recommends an annual review, and is designed to transfer if you switch lender.
7. Shopping around and your 30-day right to cancel MoneyHelper says never to buy MPPI automatically from your mortgage provider, and Paymentshield notes its cover is optional. You have 30 days to cancel a payment protection contract without penalty: Paymentshield refunds premiums within 30 days of the start date or receiving your documents, unless you've made a claim or reported an incident.

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