Life/Mortgage Protection

How much cover is available?

Life Cover:
Maximum Sum Assured: €411,575 or 7 times annual Income (up to a Max of €514,560), whichever sum is the greater.

Mortgage Protection Cover:
Maximum mortgage protection of €394,000 or the average price of a house in Dublin plus 25%.

What happens if I want to take out insurance for more than €411,575?
If you want to take out insurance for more than €411,575 then you will be requested to provide proof of your earnings.

What is the maximum Life Insurance cover I can take out?
The maximum life insurance cover available is €514,560.

What will be required as proof of earnings?
The proof of earnings required will depend on whether you are self-employed or are a P.A.Y.E. employee.

How will I prove what my earnings are?
a) If you are self-employed you will be requested to submit:

1. Details of your tax return for the most recent income tax year.
2. A copy of your annual audited accounts for the most recent income tax year.
and/or
3. A declaration from your accountant or registered auditor setting out the expected level of earned income for the current tax year.

b) If you are a P.A.Y.E. employee you will be asked to submit:

1. Your P60 Income Tax Certificate, for the most recent full income tax year.
and/or
2. A certificate of earnings completed by your employer which will show basic annual salary and any potential overtime, commissions, or bonus along with a declaration as to whether the employment is temporary or permanent in nature.

Is there any other income that can be taken into account?
There may be other income e.g. rental property income, interest on bank deposits. If you are unsure you should contact the Administrator for information about this.

Can I get mortgage protection cover for a house costing €500,000?
This will depend on what the value for the average house purchase price in Dublin is at the time of your application. If the average house price in Dublin is at least €400,000, then it will be possible to get mortgage protection cover for €500,000. The Scheme is governed by the Permanent TSB/ERSI house price index in this regard.

How do I calculate how much mortgage protection cover I can have?
Example:
Suppose Average House Purchase Price in Dublin = €400,000
then
Maximum mortgage protection cover = €400,000 + 25%
(25% of €400,000 = €100,000)
Therefore €400,000 + €100,000 = €500,000.
This means that you can arrange mortgage protection cover up to a maximum of €500,000.

What exactly can the mortgage protection cover be used for?
The mortgage protection cover is only available for the purpose of purchasing, changing or improving your primary residence.

Do I have to prove what I intend to use the money for?
Yes. For mortgage protection cover the Administrator will require proof that the cover is intended to enable the drawing down of a mortgage for the purpose of purchasing, changing or improving your primary residence.

I already have mortgage protection cover
Existing mortgage protection cover will not be part of the scheme. It may be necessary to take financial advice on your own situation.

I already have a life assurance policy, what should I do?
Existing life assurance policies will not be part of the scheme. It may be necessary to take financial advice on your own situation.

I already have a life assurance policy, does this mean that sum is deducted from the Maximum Sum Assured?
No, Scheme limits ignore existing life cover.

I only want to take out a life assurance policy for €50,000, what if I want to increase this at a later stage?
You can make additional applications anytime to increase your levels of life cover up to the maximum overall limit in force at that stage.

If I die what is the process?
Your life cover and/or mortgage protection cover is processed in the normal way through your insurer, who will pay out whatever life cover benefits that you are insured for.

Is there a time limit to enter the scheme?
No. You may enter the scheme at any time, however, it may be more beneficial for you to enter the Scheme before the end of the first year, to ensure that you are not subjected to any reductions in benefit that may apply after the Open Period of the first 12 months. Remember that after the Open Period (with certain exceptions) benefits under your policy may be reduced in the early years.

What are the exceptions to the time limit of the open period?
There are two exceptions which ensure that a reduction in benefits does not occur:
1. If you submit a proposal for insurance to an approved insurer, within three years of the date on which you have been diagnosed positive for Hepatitis C and/or HIV, then you will have full benefits immediately regardless of age or insurance status.
2. If you are still under 30 years when you submit a proposal for insurance to an approved insurer, then no time limit on entering the scheme applies.

Who decides if my cover will be reduced?
The legislation sets out a specific formula which determines how each claimant will be treated. After the open period if you apply to enter the scheme and you are deemed uninsurable by the Insurer and you are more than 30 years old then limited cover is paid out on death as follows;

If age at entry is less than 50:
The sum assured will be paid out on an increasing scale over a 2 year period, depending on the time period that the policy is in force.

If age at entry is more than 50:
The sum assured will be paid out on an increasing scale over a 3 year period, depending on the time period that the policy is in force.

I’m only in my 20s, I’m not ready to get life assurance or mortgage protection cover yet?
If you are under 30 years of age when you enter the scheme then no restriction with regard to benefits will apply.

Are there any age restrictions on entry?

  • There is a maximum entry age of 65 years. However, during the open period, the maximum age at entry is increased to 75 years.
  • All life cover under the scheme ceases when you reach the upper age limit of 75 years.
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