Changing building insurance from mortgage provider

patsyanne

Can you refuse to renew your building insurance with your mortgage provider if you feel the renewal price is too high despite having over 5 years no claims. We have paid off our mortgage but they hold our house deeds in a deeds store and keep a small debit of £125 on the mortgage to keep mortgage account open.

dunstonh

You can have your buildings insurance with whoever you like

qazitory

I am with Northern Rock with my mortage. I had to pay a £25 'admin charge' to have buliding insurance elsewhere. I'm sure other providers will have a similar scheme?

dunstonh

Most lenders no longer have that charge. It used to be very common but nowadays it is minority.

lisyloo

Some companies offer to cover that charge for you if you switch.

patsyanne

Thank you all for all your advice. I will find a cheaper insurance with the same benefits and contact them and cancel. I suppose I should pay off that £125 as well as I don't think I will be taking out another mortgage at my age and the deeds they hold are no longer valid as my husband and I changed them to tenants in common and they are held with the will company that drew up our will and changed the deeds for us.

lisyloo

You can have your buildings insurance with whoever you like

Hmmm...are your sure?
I've been looking at some mortgage deals with Leeds and in some cases it says "Home insurance required until 2018".
I presume they means theirs.

patsyanne

My situation is different as we actually paid off our mortgage after 25 years and they kept £125 debit to keep account open and to enable us to leave our deeds with them. So we actually do not have a mortgage with them other than £125

patsyanne

I did a google with the question and found this on whichprice.com under their financial page
Sometimes people assume that they have to stick with the insurance that they have taken out with their mortgage provider. Unless you took advantage of a special mortgage deal where you agreed to buy their home insurance then you are free to use independent insurers for your house protection. You might be encouraged to take out cover through your mortgage broker, as it is simpler for them. However, you are not obliged to do this by law, so it is well worth looking around for the best deal for your needs and making sure that you obtain the right cover at the right price.

lisyloo

My situation is different as we actually paid off our mortgage after 25 years and they kept £125 debit to keep account open and to enable us to leave our deeds with them. So we actually do not have a mortgage with them other than £125

It sounds very unlikely that you'd be obliged to keep it with them.
It only seems to be the case when there is a special deal in place.