Halifax reinstatement policy is branded unfair

Halifax has been accused of treating customers unfairly by not supplying reinstatement costs on its purchase valuations as standard.

Danny Lovey, sole broker at The Mortgage Practitioner, says that by not giving reinstatement costs on level one valuations as standard Halifax is not only falling foul of the Treating Customers Fairly initiative but could also be being anti-competitive.

Although the lender supplies this information on its level two and three valuations, customers can only receive it on a level one valuation by paying an extra 50.

Halifax argues that an increasing number of insurance companies use indexed property valuations based on number of bedrooms, and that it provides insurance cover irrespective of reinstatement costs.

Lovey says “Consumers can only have choice if they are provided with the rebuilding cost. Then they can check the market and make the choice that is right for them.”

Rob Griffiths, associate director at the Association of Mortgage Intermediaries, says: “If this is happening, we would agree that lenders should not withhold this information. It is probably not in the spirit of TCF to do this, especially when a customer has paid for a valuation.”

Paul Fincham, spokesman at Halifax, says: “We have simply adopted an approach that gives consumers a choice regarding the breadth of the information they need.”