Is mortgage interest rate insurance really worth it?

The Guardian reports on a new type of insurance available to home owners worried about spiralling interest rates. Marketguard is offering mortgage holders insurance that protects against Bank of England base rate rises. Policies can protect against rises more than a nominated one to two point five percent above the current base rate and the rate of the lender. If both figures exceed this nominated rate the insurance will start paying out.

Costs vary depending on the amount borrowed and rate insured against, but average around the equivalent of a half percent interest rate rise in themselves

But the cover only lasts two years after which terms are renegotiated, the entire premium has to be paid up front in a single lump sum and mortgage brokers insist that in most cases it would be cheaper to opt for a fixed rate mortgage or remortgage at a later date. However, in the current climate the possibility of remortgaging is not available to everyone, and the Bank of England base rate has risen nineteen times in the last ten years, so Marketguard might just be an alternative worth investigating.