Unemployment cover and your mortgage

How it typically works

After a waiting period following the job loss, the policy pays your monthly mortgage payment — sometimes only the principal and interest, not taxes and insurance — for a limited number of months.

It's a bridge, not a replacement. Both the waiting period and the benefit period are set by the contract and vary widely.

What's commonly excluded

• Resignation, or dismissal for cause
• Self-employment, which is often excluded entirely
• Fixed-term, seasonal and contract work
• A job loss you knew about, or that was foreseeable, when you bought
• A waiting period after purchase before any claim can be made
• A minimum period of continuous employment before you qualify

The questions to ask before buying

• How long is the waiting period after a job loss before payments start?
• How many monthly payments will it make, at most?
• Does it cover the full payment including taxes and insurance, or only principal and interest?
• Am I eligible given my employment type — and would I still be if I changed jobs?
• How long must I be employed before I can claim?
• Can I cancel, and what refund applies?

Why this product needs care

Coverage sold alongside credit has a poor history, largely because it was sold to people whose employment type made them ineligible to claim in the first place.

That's not an argument against the product; it's an argument for confirming eligibility in writing before paying anything. If a seller can't answer the eligibility question clearly for your situation, that answers it.

What often serves better

An emergency fund covers job loss and everything else, has no exclusions, and doesn't stop after a set number of months. Where you can build one, it generally beats this product.

Where you can't yet, the honest comparison is between a limited, conditional benefit and no cushion at all — which is a genuine decision rather than an obvious one.