As you say 'if a policy was assigned', not all banks assigned the policy.
I don't what we are having a discussion about here? This has nothing to do with the OP's query. It is a simple fact that many people with mortgage difficulties have let their insurances lapse, ask anyone working with these people.
Sumatra, what misconduct are you talking about that should be reported?
And just to clarify only yesterday I helped someone fill an SFS and they have no life or house insurance in place, both long lapsed so this is not years ago we are talking about. I also fail to see what that bank is realistically going to able to do about it. Yes it is the part of the t&c, yes it is the borrowers responsibility to maintain cover, borrower has €188 p.w. to live on in rural Ireland, car essential (14yrs old so no downsizing possible), there are no funds to pay.
I am tired of this discussion, anyone would think I was encouraging people to let their insurances lapse, as a matter of fact it is an awful situation with possible dreadful consequences, I have dealt with case where life policy had lapsed and unfortunately customer got cancer and died, wife left with children and mortgage, it happens. Until people have money in their pockets to pay their bills it will continue to happen.