Can anyone advice on this insurance/mortgage issue?

lightspeed

Took out a HSBC mortgage a month ago.

I was "strongly" advised to take out one of their income protection products during the application process and was given the impression that my application would not be successful if i didnt take their policy.

To avoid complications i reluctantly agreed knowing full well i could get cheaper like for like cover elsewhere.

Subsequently, I have now obtained similar cover at a better price and purchased this and would like to cancel this HSBC policy.

Can there be any repercussions of doing this?

The wording of the offer letter is..."we would like to remind you of the importance of having adequate life cover etc....we do not nrrd to hold these documents unless they are with HSBC"

_Andy_

No consequences at all. (Obviously though make sure the cover is like for like etc and don't cancel until the new policy is in force)

thor

As far as I know, mortgage advisers for the HSBC have to tell you beforehand that they can inform you about all these insurance products but you are under no obligation to take them. From this I take it that this should not affect the decision process either.

kingstreet

Defaqto rates insurance products and awards them stars for their quality and features. HSBC's Sickness Choice scores one star and its Individual Income Protection scores three stars.

You are likely to find the bank's premiums on the high side.

If you cancel the HSBC plan, there will be no repercussions for you. I suggest talking to an IFA about cover with one of the providers of a five star product. This includes insurers like Friends Provident, L&G, Aegon, LV etc. It will probably be cheaper than the bank's product as well as better quality.

http://www.defaqto.com/star-ratings/find-product/income-protection-insurance/5

I suggest you maintain your current cover until your new plan starts, to ensure you're covered at all times.

magpiecottage

lightspeed wrote: »

The wording of the offer letter is..."we would like to remind you of the importance of having adequate life cover etc

Quite right - it is important. Furthermore it protects the bank against any complaint that you didn't realise it was important.

However, "important" you seem to be interpreting "important" as "compulsory". I suggest you check your dictionary to see if they have the same definitions.

we do not nrrd to hold these documents unless they are with HSBC"

"unless they are with HSBC" seems to me to show that they could be with somebody else.

Can there be any repercussions of doing this?

Apart from you demonstrating your own foolishness, none that I can think of.

lightspeed

magpiecottage wrote: »

However, "important" you seem to be interpreting "important" as "compulsory". I suggest you check your dictionary to see if they have the same definitions.

Apart from you demonstrating your own foolishness, none that I can think of.

Thanks for the responses.

I have not interpreted "important" as "compulsory" in this instance. I new all along that it is a recommended policy but as previously mentioned i was given a hard sell and the "impression" that without this insurance our application would not be successful.

Furthermore, having got to the final stages of the application process with a company notorious for turning people down, i do not consider "playing the game" as being foolish, maybe just a little over cautious.

I will cancel the policy as soon as we make the first payment with LV.