In light of the Government consultation on compulsory insurances, lenders are reviewing their strategies.
Melton Mowbray has removed its compulsory insurances across its range while Market Harborough no longer insists on buildings and contents insurance. However, its own ASU cover remains compulsory on some of its products, since at £1.50 per £100 of cover the society deems it to be very competitive.
But 23 lenders in the market still tie-in mortgages with insurance products, 22 of which are mutual building societies.
The Government is currently investigating the abolition of compulsory insurances on mortgages on the grounds that the lender’s insurance may be expensive and that any discount is offset by the commission the lender receives from the insurer.