The insurer has warned that many borrowers will not only end up paying around 30 per cent more for home cover than they would if they bought separately, they could also be faced with penalty charges if they try and move the cover later.
Mortgage brokers have an increasingly important role to play in sorting out the supplementary aspects of arranging a mortgage, and as Direct Line claims that 46 per cent of borrowers have home insurance through their lender there is plenty of scope for to save clients money.
Malcolm Cooper, home insurance business manager at Direct Line, said: "Home insurance is probably the furthest thing from most people’s minds when they are embroiled in the house hunting process. Furthermore, amidst all the excitement and angst associated with negotiating the purchase of a new home, it is an easy step for mortgage applicants to simply accept, without question, what on the face of it might appear to be the simplest and safest option offered by their lender. However, as many people have already found out, that can be an extremely costly decision."
