A Mortgage Protection Insurance Policy should cover your mortgage obligations. It is an insurance product which combines income protection and life insurance in one package. Cover is provided for mortgages on residential property owned by individuals as their primary home or as an investment property.

A Mortgage Protection Insurance Policy protects you and your family, unlike Lender Mortgage Insurance which protects the lender against your default.  If you default, you loose the property under a mortgagee sale and LMI covers the difference between sales proceeds and the debt owed to the bank.  You only receive money if the property sells for more than the mortgage and after all costs have been deducted.

In the event of death, your partner should receive insurance payout to payout the mortgage.  In the event of total disablement after 6 months, you should receive insurance payout to payout the mortgage.  If you are self employed or casual, you should have income protection that will keep up monthly mortgage payments.