Dáil Éireann Debate, Tuesday - 27 June 2017
158. Deputy Joan Burton asked the Minister for Finance if he will intervene in the case of a person (details supplied); his views on whether this is particular discrimination against this person and their partner, particularly in view of the fact they have been provided medically with the all clear; and if he will make a statement on the matter. [29756/17]
Amharc ar fhreagraThe Central Bank have advised that when an individual(s) applies for a mortgage loan to buy a home, the individual(s) will generally be required to take out mortgage protection insurance. This is a particular type of life assurance taken out for the term of the mortgage and designed to pay it off on the death of the borrower or joint borrower.
It is an underwriting consideration for an insurance firm to decide whether to take on the risk or not. Should the insurance firm take on the risk, it may result in a large loading/premium for the customer. Alternatively, the insurance firm could decide not to take on the risk at all. This would be a commercial/underwriting decision by the insurance firm.
In most cases, a lender is legally required under Section 126 of the Consumer Credit Act 1995 to ensure that a mortgage applicant has a mortgage protection insurance policy in place before granting a mortgage loan, with some exceptions. One of these exceptions is “loans to persons who belong to a class of persons which would not be acceptable to an insurer, or which would only be acceptable to an insurer at a premium significantly higher than that payable by borrowers generally”, in which case the Act does not require the lender to ensure that mortgage protection insurance is in place.
