B&B mortgage with compulsory insurance?

dunamis

Hi folks.
I took out a B&B mortgage in 2000 and to get the specific deal I had to take out two types of insurance (an income protector and some other one that I can't recall now). I kept the income protector policy for six years before cancelling it.

I've looked at a number of threads and articles but I'm still not clear if they were 'allowed' to insist that I take those insurance policies or whether that is now considered misselling and can be reclaimed.

Advice and comments welcome.

Ronnie

dunstonh

I took out a B&B mortgage in 2000 and to get the specific deal I had to take out two types of insurance (an income protector and some other one that I can't recall now). I kept the income protector policy for six years before cancelling it.

Quite common with many lenders from around the mid 90s to very early 2000s.

I've looked at a number of threads and articles but I'm still not clear if they were 'allowed' to insist that I take those insurance policies or whether that is now considered misselling and can be reclaimed.

Cross subsidy deals were allowed then and still allowed today. Although you dont see them much now. If the lender insisted in insurance as part of the deal then it is not mis-sold as long as the insurance was suitable.

Where it is missold is where the seller tells you it is compulsory but it isnt. That is a lie. Although its a very difficult complaint reason to prove as there is rarely any evidence to back it up.

B&B did sell a lot of income protection through its branches. Although it should be noted that this was not PPI.

blue-eyes1955

Sorry to hijack this thread but it seems quite similar to a query I have. We applied for a business loan from Natwest and they told us we needed life insurance. I have a letter stating "a life policy shall also be required for the loan advance" which I understood to be compulsory. Natwest quoted to supply the insurance but I got it cheaper through Legal and General. Does this class as misselling and if so I presume I have to go through Natwest even though I arranged it myself through someone else?

dunstonh

We applied for a business loan from Natwest and they told us we needed life insurance. I have a letter stating "a life policy shall also be required for the loan advance" which I understood to be compulsory.

That is quite normal in business loans.

Natwest quoted to supply the insurance but I got it cheaper through Legal and General.

As to be expected.

Does this class as misselling and if so I presume I have to go through Natwest even though I arranged it myself through someone else?

No. it is not misselling. As mentioned above, compulsory insurance is allowed as a condition of borrowing.

Even if it was misselling, you would actually not be able to complain to natwest as they did not sell the policy. However, that doesnt matter as it was not mis-sold.

antrobus

blue-eyes1955 wrote: »

Sorry to hijack this thread but it seems quite similar to a query I have. We applied for a business loan from Natwest and they told us we needed life insurance. I have a letter stating "a life policy shall also be required for the loan advance" which I understood to be compulsory. Natwest quoted to supply the insurance but I got it cheaper through Legal and General. Does this class as misselling and if so I presume I have to go through Natwest even though I arranged it myself through someone else?

Basically, no.