When you finance something that needs to be insured like a house, car, boat, RV, etc., the financing company is named on the policy. This makes sense because they are part owners of the property.
Once the loan has been paid off, you should notify your insurance company to remove them. This is important because if there is subsequently a claim filed, any check that is issued will be in the name of you and your lender. Your insurance company will then have to issue a stop-payment on that check and issue a new one, a process that could take another week or two.
I had this happen to a client recently. Save yourself a potential headache by keeping your policies up to date.