Mortgage insurance requirements in Ireland
Choosing the right insurance to protect you and your home is vital. Here’s what insurance you need for your Irish mortgage, how much it costs, and how to get the best value.
What insurance do you need with a mortgage?
Securing a mortgage is exciting, but understanding your insurance requirements on top of everything else can feel overwhelming.
Our guide explains exactly what insurance you need for your Irish mortgage and why, what you can expect to pay and how to choose the right cover.
Mortgage insurance in brief
| Insurance type | Required? | Average monthly cost | Who needs it? | |
|---|---|---|---|---|
| Mortgage Protection | Yes (mandatory) | €25 – €80 | All mortgage holders (some exceptions) | |
| Buildings Insurance | Yes (mandatory) | €30 – €60 | All mortgage holders | |
| Contents Insurance | Optional | €15 – €40 | Recommended for homeowners | |
| Income Protection | Optional | €50 – €150 | Those without employer sick pay | |
| Serious Illness Cover | Optional | €40 – €120 | Depends on personal circumstances |
Mandatory mortgage insurance in Ireland
The only two insurances that are compulsory with a mortgage are mortgage protection and buildings insurance.
These insurances are a legal requirement under the Central Bank of Ireland regulations for most borrowers.
1. Mortgage protection insurance
Mortgage protection is a life insurance policy that pays off your entire mortgage balance if you pass away during the mortgage term. It’s a legal requirement under the Central Bank of Ireland regulations for most borrowers.
Mortgage protection must cover the full loan amount and span the entire mortgage term.
Mortgage lenders in Ireland can only authorise a mortgage if this protection is in place unless you fall into one of the exceptions set out by law.
Why it’s mandatory
How much does it cost?
Here’s some examples of typical costs:
-
€200,000 MORTGAGE 20 year term, Smoker aged 25, Typical cost = €10 to €15 per month
-
€250,000 MORTGAGE 39 year term, Non-smoker aged 29, Typical cost = €15 to €20 per month
-
€370,000 MORTGAGE 35 year term, Non-smoker aged 35, Typical cost = €20 to €30 per month
-
€400,000 MORTGAGE 25 year term, Smoker aged 40, Typical cost = €80 to €120 per month
What affects the cost?
- Your age when taking out the policy
- Whether you smoke
- Your health and medical history
- Mortgage amount and term
- Type of cover (reducing vs. level)
Types of mortgage protection
There are two main types of mortgage protection.
- Reducing term cover For repayment mortgages where the capital and interest are paid off. The cover starts at full mortgage value but reduces as the term progresses and the mortgage is repaid.
- Level term cover For interest only mortgages where only the interest of the loan is paid off, not the capital. The cover is for the full loan amount and remains level throughout the term.
You can find out more about what mortgage protection covers, costs, and how to choose the right policy in our guide to mortgage protection in Ireland.
2. Buildings Insurance
Buildings insurance covers the physical structure of your home against damage. It’s mandatory for the entire mortgage term.
What’s covered:
| Structure | Outbuildings & External | |
|---|---|---|
| Walls, roof, and foundations | Garages and sheds | |
| Windows and doors | Driveways and patios | |
| Floors and ceilings | Garden walls and fences | |
| Plumbing and wiring | Gates and pathways | |
| Built-in fixtures (kitchen, bathrooms) |
What type of damage is covered?
- Fire and smoke and flood damage
- Burst pipes and water leaks
- Subsidence and ground movement
- Theft and vandalism
- Falling trees, branches or other impacts
Should you cover market value or rebuild cost?
Your property’s market value and rebuild cost are different. Buildings insurance should cover the full rebuild cost, which is often lower than market value but can be higher for older or unique properties.
Use the Society of Chartered Surveyors Ireland’s house rebuilding cost calculator or hire a surveyor for an accurate assessment.
How much does it cost?
The cost depends on the value and size of your home, although other factors should also be considered:
Here’s some typical costs:
- 3-bed semi-detached in Dublin: €35 to €50 per month
- 4-bed detached in Cork: €40 to €60 per month
- 2-bed apartment: €25 to €35 per month
Our comprehensive guide to buildings insurance includes details about policy exclusions, extra cover you can add, and the amount of cover you need.
Other types of insurance to consider
There are other types of insurance worth considering when getting a mortgage. They’re not essential but can offer peace of mind and additional financial protection if things go wrong.
Income protection
Income protection, also known as salary protection, can replace some of your income if you get sick or injured and cannot work after a set term.
Your cover needs will depend on:
- Company sick pay entitlements
- Other accessible funds
- Other insurance policies you have, e.g. serious illness cover
You can learn more about how income protection works and how to choose the best policy in our guide, Should you get income protection insurance?.
Serious illness cover
This cover, also known as critical illness cover, can pay out a lump sum if you’re diagnosed with a serious condition that’s listed in the insurer’s policy document.
You can choose the amount of cover you want, e.g. €100,000, and use your lump sum to help:
- Cover your everyday bills and living costs
- Pay for any treatment you require
- Adapt your home to support your needs
You can add serious illness cover to a life policy, including your mortgage protection policy, or get a standalone policy.
To find out more about serious illness cover and decide whether it’s right for you, read our guide, Should you get critical illness cover?.
Contents insurance
Contents insurance is a type of home insurance that covers the things in your home, not the building itself. This includes:
You can claim on your contents insurance if any items are lost, stolen or damaged, e.g. from fire or flood. Accidental damage is not usually covered as standard, but it can be added to your policy.
Find out more about contents insurance and how to find the right policy in our guide to contents insurance.
How to get the best value mortgage insurance
Budget between €55 - €140 per month minimum for mandatory insurance and consider optional cover, especially income protection, if you’re self-employed.
The actual cost will depend on a range of factors, including your age, health and mortgage.
To keep insurance costs to a minimum:
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