Almost five million people who have a mortgage on their own home could be losing a combined £600 million every year on their home and life insurance, because they buy their mortgage lender’s products instead of shopping around.
Nearly half of homeowners with a mortgage (46 per cent) bought buildings, contents or life insurance from their mortgage provider.
Of those, around one in 10 (12 per cent) people did so because they thought it was compulsory to buy home or life insurance from the same company that provides their mortgage.
Whilst, one in 20 (4 per cent) even believed their mortgage was at risk if they didn’t buy insurance too.
And almost two-thirds (63 per cent) are not shopping around, instead choosing their lenders’ insurance because it was 'convenient'.
Phil Ashkuri, head of insurance at Post Office Financial Services, said: “Convenient doesn’t always mean cheap. Many homeowners don’t realise taking out buildings and contents insurance with their mortgage lender is generally not the best value deal. And it’s not compulsory for securing their mortgage.
“Our advice is shop around as there are better home insurance deals out there from standalone providers. The Post Office takes the hassle out of finding the best policy at the right price by searching a panel of companies on your behalf.”
