MORTGAGE holders are paying too much for their insurance because they are being pressurised into taking it out through their bank.

Research by Comparethemarket.com found that 17 per cent of mortgage holders take out home insurance through their mortgage provider. However the average person could save £666 by switching to a different home insurance provider. This equates to consumers paying £90 million too much for home insurance across the UK.

The company surveyed 2,000 mortgage holders and found that 44 per cent of them chose to take out insurance with their bank because it was the “easiest option". Meanwhile 11 per cent of them said they felt pressured to take out the policy in order to help secure their mortgage.

Gemma Sonfield, Head of Home Insurance at comparethemarket.com, said: “When you consider the huge outlay required when buying a house, it is very easy to ignore the potential savings from shopping around for a home insurance policy. However, as the statistics show, almost £90 million is being overpaid unnecessarily by taking the default option of home insurance via their bank.

“Perhaps the most concerning finding in our research is that more than one in ten people felt pressured to take the home insurance policy in order to secure the mortgage and that the same number didn’t even know that shopping around was a possibility. If some people feel forced to take what can be a more expensive policy, banks need to evaluate how they communicate with their customers.”

On a more optimistic note, however, the survey found that customers appear to be getting more clued up, with 52 per cent of them having shopped around for a better deal on their home insurance within the last year. Only six per cent of those surveyed said they had never researched a better alternative.