Why might lending institutions insist on additional collateral security?

To protect themselves in case the primary security falls short

Lending institutions may insist on additional collateral security for the primary purpose of safeguarding their interests and minimizing risks associated with the loan. Lending institutions want to reduce their exposure to risk. By requiring additional collateral, they ensure that they have more assets to fall back on if the borrower defaults on the loan or if the primary security's value is insufficient to cover the outstanding loan balance.