Why should people pay for something they do not need, has no value to them and nobody is actively forcing them to buy? Singletons are beginning to ask these questions about mortgage protection insurance.

This cover pays off your mortgage if you die. Banks like it because they earn tasty commission (90% in year one) for selling a product that saves them a lot of hassle. And it is very important for those with partners or dependants of any age who will need to be cared for after they are gone.

But what is it really necessary for a single person with no dependents whatsoever?

Cousin Wilbur in Wisconsin, twice removed, may be delighted when he inherits a million bucks for your fullypaid-off luxury pad in Celtic Tiger Towers. And the bank will be over the moon about not having to go through the messy process of selling your property before the mortgage is paid off.

But what value is that to you - now six feet under - after stumping up ten grand for this piece of insurance?

As the Financial Regulator showed in a new survey, mortgage protection doesn't come cheap.

A 26-year-old male smoker coughs up Euro32.39 a month (with Irish Life). Over a year that amounts to Euro388.68, and over the 35-year mortgage term the tally is Euro13,604.

He could save over three grand in all by shopping around and getting the cheapest deal (Eagle Star) at Euro25.01 a month.

But what if he has no dependents? Can he decide not to pay mortgage protection at all? The savings could be over 13,500 grand on a product that is of no value whatsoever to the mortgage holder.

The Consumer Credit Act 1995 compels banks to arrange that people take out protection insurance with their mortgage, with some exceptions (see below). However, does it force them to continue compelling borrowers to buy a policy that cannot possibly be of any value to them in this life?

The wording of the Consumer Credit Act 1995 (http: //acts2. oireachtas. ie/zza24 y1995.10. html) appears to be ambiguous. It states: "a mortgage lender shall arrange, through an insurer or an insurance intermediary, a life assurance policy".

However, a spokeswoman for the Financial Regulator said: "The Consumer Credit Act states that a lender must ensure that the borrower has a life insurance policy in place to repay the loan in the event that the borrower dies before the loan is repaid. So, as long as the loan has not been repaid, the life insurance policy must be in place."

But no one else we spoke to in the industry, including major banks, seemed to be aware of their role as mortgage protection police.

"It is well known that lenders must put mortgage protection in place if applicants are under 50, " said Michael Dowling, president of the Independent Mortgage Brokers Association.

"There are exceptions - such as if the cost is prohibitive due to a medical condition like diabetes or if a borrower simply cannot get cover, but the bank will insist on it when it is taken out."

However, "if they are going to cancel it after a month, what will happen? Lenders don't seem to have systems that even recognise when policies are cancelled? And how could they, when policies are placed with other institutions?

"People have taken out life policies and cancelled them and never been approached by the bank. And there is an argument as to whether a single person really needs life cover, " he said.

So do banks insist on borrowers keeping up mortgage protection insurance repayments?

Or is such a thing even possible, given that their customers can take out policies with a wide range of institutions?

A banking source said they generally insist on mortgage protection in mortgage contracts, usually as a specific condition. However, he conceded, that "it leaves the onus on the customer to keep the payments up".

A spokesman for AIB said the requirement to take out a mortgage protection policy is included in the terms and conditions of mortgage documentation. After that, "the obligation appears to be on the borrower to maintain the life cover".

And while confusion reigns about who is going to bring them to task, the mortgage protection rebels who refuse to pay at all continue to save thousands every month.