Confused about building insurance, help please?

oneofseven

Hi,
This is probably one of those stupid questions but I am trying to understand my finances better, so really looked at my mortgage statement when it arrived this year. We have buildings insurance with the mortagage provider (G&G). Looking at our yearly statement they add £25.85 at the start of each month to our mortgage account which increases the balance. At the end of the month our mortgage payment combined with insurance payment is taken off.
Does this mean we are paying interest on the insurance premium every month?
I've tried using amoritization templates to figure out what effect our overpayments are having but they are mostly american and always give a higher scheduled payment than our mortgage provider. Can anyone recommend a template that will help?
Any help wouild be appreciated.

NeilQuinn

Not sure of a template to help you work out the true cost but looking at that figure, it seems high if it's only Buildings Insurance. (unless you live in a large older property). I don't pay that much for buildings AND contents.

Dan_Collins_2

Call C&G and ask them. The lender I worked for had the same statement system, it showed as added but interest was never charged on the amount.

The only time they would charge interest on it, would be if you did not take any buildings insurance out and they forced it in place, which they can do!

oneofseven

Thanks for that, will check out cheaper providers and call C&G.