The excess period (sometimes known as a waiting period or deferred period) is the length of time you would need to be off work before your Mortgage Protection policy starts to ‘accumulate benefit’.
For example, if you have an excess period of 30 days the policy will start accumulating one day of benefit for every day you are absent from work from day 31 onwards. This means that if you were off work for two months you would receive one month of benefit.
If a policy has an excess period with ‘back to day one’ cover, this means the policy will start accumulating benefit from day one. For example, for a policy with a waiting period of 30 days the plan would start paying out after 30 days (i.e. for the month just passed), rather than 60 days for a plan without the back to day one element and a 30 day excess period (i.e. for the period from day 31 to day 60).
This can be complicated to get your head around, so if you need to ask any questions don’t hesitate to drop one of Drewberry’s experts a call today.