British Insurance Begins Selling Rental PPI
Due to the fact that more people are renting than ever before in Britain. British Insurance has decided to inaugurate payment protection insurance policies, for people that rent properties. The policies will meet their monthly rental outgoings, should they become unemployed at any point, although not through circumstances of their own volition.
The move has come after the Council of Mortgage Lenders released figures, stating that 17.300 first time buyer mortgages were approved in July of this year, which is a drop of 15.800, in comparison to July of last year. This coincides with the Royal society of Chartered Surveyors, stating that rental accommodation is experiencing a two year high.
What with so many people having been turned down for mortgages in recent times, a lot of people are going to look for an alternative that does not involve moving back in with mum and dad. It is not just the people who have been turned down mortgages either, but those that do not want to risk lending, during the credit crunch.
What with mortgage payment protection being common, it only seems logical that the masses of people in the rental market are given the same level of protection. It is not as though people that rent, are not in the same primary position of being at risk of losing their homes at some point. Because a person does not have their name on the deeds of a property, this does not mean that they do not deserve the security that homeowners are given by a PPI.
It is not just the people who rent, that will be pleased to have such a policy available to them. Landlords would much rather keep a reliable tenant, and the impact of not receiving payment can be massive, especially for the landlords with smaller property portfolios.
The main reason that tenants have to be evicted from properties, is because they do not pay their rent. So such policies are going to be welcome by all concerned in the rental market. The added bonus is that the policies can be set up, so that in the event of a tenant becoming unemployed, the monies are paid directly into the account of the landlord, so that they see as little effect on their finances, as possible. Such policies are likely to be welcomed, what with the imminent credit crunch, as more and more people face redundancy.
The policy that British Insurance has introduced, will cover tenants for up to �1500.00 worth of monthly rent, or 50% of their gross monthly income. It costs just �1.90 a month, per �100.00 worth of monthly benefit. There are variants relating to the structure of payouts, but policy holders will be able to claim their rent, dating back to the day that they became unemployed.
The HBOS/Natwest situation is just one example of how little security there is in jobs from a wide variety of sectors. The fact that many people are becoming part of what can only be described as redundancy culls, highlights the requirement for rental PPI, and it is likely that it will be of massive benefit to people from manifold walks of life. It must be considered that the credit crunch is going to cause people to be off work through stress related illness, and not just because they have lost their jobs.
In this bleak time of social uncertainty, it is refreshing to see that at least one of the big companies, is thinking of the nations welfare.