Issues with mortgage insurance legal and general

Alybaxter

Hi 
I hope someone can help, I have just realised that a current mortgage insurance policy I have with legal and general is for my previous property which was paid off 11 years ago, and not for my current property where I have a separate policy with Aviva.  I can’t believe that I didn’t realise I am paying both and have struggled to actually find any paperwork associated with the L&G one.  So my question is surely when my mortgage ended the insurance should have automatically ended also ?  If this is the case can I claim the premium back ?  

dunstonh

 So my question is surely when my mortgage ended the insurance should have automatically ended also ?

How would they know unless you told them?

The insurance is not tied to that mortgage.    Some people stay with the same lender. Some people move to a new lender.  Moving to a new lender doesnt mean you have to move the insurance.   Some people retain the cover when their clear the mortgage just as a bit extra personal provision.

If this is the case can I claim the premium back ?  

No.  You have just had extra cover that would have paid out if you had suffered a claimable event.

Alybaxter

Hi Dunstonh  many thanks for replying I appreciate it.   I now realise why they have my new address its because we let the house out for a short while after we left.  I definitely didn’t actively request to keep the mortgage insurance on as I set up new insurance with a different company for my new mortgage.  I did notice the amount coming out (luckily its a small amount) but for some reason convinced myself that it is part of my current mortgage. Without any paperwork to go on I have just left it, I have now requested my original documents from the company.  I agree that as its claimable against this mortgage I won’t be able to claim but still believe it to be an oversight on both our parts.  

Cheers 

Nearlyold

There is no oversight on the part of L&G, life insurance providers do not monitor your mortgage nor are they expected to treat you moving house as a reason to question whether you still require the cover.

A system where Life Insurers automatically ended a policy because the mortgage it covered had ended could leave customers whose health had declined with no life cover and possibly unable to obtain new cover. Not to mention the additional complications if the customer had simply re-mortgaged to a new lender and still required the cover, only to find the policy  automatically cancelled  because the insurer picked up the mortgage had been paid off.

dunstonh

I definitely didn’t actively request to keep the mortgage insurance on as I set up new insurance with a different company for my new mortgage.

Unless you cancel the direct debit and/or tell them that you no longer want it, they will retain it.   Can you imagine the uproar if the insurer cancelled insurance without you telling them and you suffered a claimable event?

 I have now requested my original documents from the company.

It is unlikely they will retain any of the original documents as most are scanned and destroyed nowadays.   Plus, if it was put in place by a third party company (e.g. estate agent, IFA, solicitor, accountant etc) then it would be those that hold copies of the original paperwork.

I agree that as its claimable against this mortgage I won’t be able to claim but still believe it to be an oversight on both our parts.  

I'm struggling to see how you can consider it an oversight by the insurer.   The lender wouldn't tell them you no longer have the mortgage and even if they did, you can still retain the insurance anyway, as many people do.  The insurance and the mortgage are not physically linked.  The insurance is a standalone plan that can be held with or without the mortgage.