In order to draw-down on funds for a new mortgage, it is a requirement to have home insurance and mortgage protection insurance in place.
I'm wondering what would happen if post draw-down, the mortgage protection policy was cancelled?
When I went through the process, the lending institution had to be noted as a beneficiary on the home insurance, but not on the mortgage protection policy. Obviously, you could leave your dependents / estate with a liability if you die before the mortgage is paid off, but if there are other assets that cover this, are there any other implications of cancelling your mortgage protection policy?
Do the lending institution have any way of checking if the policy is in place, or do they even care?