Almost one in two (48%) borrowers are seriously concerned about missing mortgage repayments due to the cost-of-living crisis, said MetLife UK.

This has risen from 37% a year ago.

The insurance provider said that the rising cost of living ‘continues to be felt keenly throughout the country’. It found that homeowners are looking for ways to better balance their budgets.

MetLife surveyed homeowners, together with people in the process of taking out a mortgage, to understand their financial situations, and what they would do if something unexpected happened.

It found that 42% have no savings to fall back on if they found themselves unable to pay their mortgage, up from 40% in 2021.

And a worrying 71% would be unable to cover their mortgage repayments for more than two months, leaving nearly three-quarters of people exposed if they weren’t earning their usual income.

Lack of protection knowledge

The survey revealed that only one in 10 people are aware that there are protection policies available specifically for their mortgage repayments.

MetLife’s MortgageSafe policy makes monthly repayments from the first day an individual is unable to work. There’s a short four-week waiting period, no underwriting on accident-only policies, and accident and illness policies are available for 12- or 24-months. It can cover 110% of the monthly repayment value, up to a maximum of £1,500.

Rich Horner, head of individual protection at MetLife UK, said: “For those with a mortgage, many are starting to see their monthly repayments rise in line with rising interest rates. With the uncertainty around how high interest rates will go and the ongoing pressures on the cost of living, the worry of meeting payments can be daunting.

“Yet just one in 10 are aware that for a relatively small monthly fee, they can ensure they have protection in place to cover their mortgage repayments – often the largest monthly outgoing for many.

“At a time when households are looking even more closely at their finances to ensure they keep up with household bills and payments, accessing the right mortgage protection policy is a simple and cost-effective way to safeguard finances should a homeowner have an accident or were to become ill, and they weren’t earning their usual salary as a result. Providing that peace of mind is more important than ever.”