British Money has launched Universal Cover which pays mortgage borrowers who lose their jobs or who are prevented from working due to an accident, sickness or caring commitments for up to a year.
Universal Cover insures up to 60% of gross monthly income (up to £2000), and financially protects the self-employed and contract workers, as well as those in permanent employment.
It offers three months free cover, no excess or exclusion period, a discrimination-free premium of £4 for every £100 of cover (regardless of age, occupation, smoking habits or medical history.)
The policy accepts claims following the onset of a range of conditions including Alzheimer's, Cancer, stress and backache.
Like income protection, benefits are paid directly to the policyholder and can be used to pay mortgages, shared ownership costs, as well as other outgoings and luxuries, the firm said.
In the online application service, applicants are required to answer four eligibility questions and complete their details, with no medical feedback or proof of outgoings necessary.
"There is currently an enormous protection gap," said Simon Burgess, director at British Money.
He continued: "State Benefits are meagre, means-tested and set to be reduced further with the rollout of Universal Credit. We hope that our approach will revitalise consumers' appetite for this essential cover and rebuild the reputation of payment protection among consumers and their financial advisors."
Universal Cover has been developed for British Money by Cigna Europe Insurance Company.
