Catherine Murphy (Kildare North, Independent)
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To ask the Minister for Environment, Community and Local Government if he is satisfied that the mortgage protection policies insisted on by local authorities have not been mis sold; the reason they make no provision for loss of work; if they are regarded as value for money; and if he will make a statement on the matter. [45539/12]

Jan O'Sullivan (Limerick City, Labour)
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The local authority mortgage protection insurance scheme is overseen by the Mortgage Protection Committee which is a sub-committee of the County and City Managers Association (CCMA) and is representative of the CCMA, local authorities, the Housing Finance Agency and my Department.Participation in the mortgage protection insurance scheme is compulsory for local authority house purchase loans for social and affordable housing. One of the conditions of the Plan, which is a group policy, is that it is obligatory for all local authority borrowers who meet the eligibility criteria to join the scheme. Altering this condition would have a negative impact on the scheme and increase the cost for all existing borrowers.

The provision requiring that mortgage protection insurance is held by mortgage holders is contained in the Consumer Credit Act 1995. This legislation is the responsibility of the Minister for Jobs, Enterprise and Innovation.

Compared with other schemes of mortgage protection, the local authority scheme covers disability as well as death, and the disability cover is for the full period of the disability and not just 12 months as is the case in the majority of MPI policies available.

The Mortgage Protection Committee seeks to achieve a balance between the most economic rate to be charged for the scheme and the benefits provided. In negotiating a renewal of the scheme, which came into effect from 1 January 2012, the Committee was able to harness the downward pressure on pricing in the economy and secure an average 19% reduction on the rate which applied to the previous scheme.