Joan Collins (Dublin South Central, People Before Profit Alliance)
Link to this: Individually | In context | Oireachtas source

161. To ask the Minister for Finance if his attention has been drawn to the fact that a number of Permanent TSB customers who topped up their mortgages with Permanent TSB were issued second home and life insurance policies; his views on whether PTSB has a duty of care to check all remortgaged policies on its books to verify and pay back moneys paid into these policies; and his views on this practice of issuing second policies. [6609/14]

Michael Noonan (Limerick City, Fine Gael)
Link to this: Individually | In context | Oireachtas source

I am informed by Permanent TSB that it is normal lending practice to ensure that a customer has in place sufficient life assurance to cover the value of their mortgage (which with limited exceptions is otherwise a legal requirement under the Consumer Credit Act),  together with home insurance to cover the replacement value of a house on which the mortgage is charged. When a customer increases their borrowings through a re-mortgage, and the new borrowings exceed the cover provided by the existing life policy, then it may be necessary to increase the level of life cover to match the new amount borrowed. In some circumstances, additional buildings or contents cover may also be required if the purpose of the re-mortgage was for home extension or where the existing home insurance policy was found not to provide adequate cover on the existing property. At no time did Permanent TSB have a policy of knowingly issuing surplus home or life policies to customers where adequate cover on the mortgage was known to be in place. 

 I am informed by Permanent TSB that the customer to whom the Deputy refers took out a Home Insurance policy from a TSB Branch in 2001.  Five years later, in 2006, the customer acquired a second Home Insurance policy while re-mortgaging in a different branch. It was not a condition of the re-mortgage nor was there any requirement to retain the 2001 policy. However it would appear that this policy was not cancelled by the customer. 

 Permanent TSB has informed me that when it was made aware by the customer that two policies were in place a full refund was issued by the insurance company for the overlapping period and the policies cancelled at the customer's request.  I have also been advised by Permanent TSB that this type of substantiated complaint is very rare and that the Bank firmly believes there are no wider issues that would be uncovered from a review of its loan book. 

Finally, the Bank also has processes in place to ensure that customer complaints of this type are dealt with thoroughly and in a timely manner. If dissatisfied with the Bank's response customers also have the right to refer their complaint to the Financial Services Ombudsman for adjudication.