Bank will not release insurance check

I live in NC, and back in 2006 my car suffered hail damage. At the time I had a lien on the car so when my insurance company made the check, it was made to me and the bank. The bank informed me it would be best if I deposited the check in my savings with a hold on the funds pending repairs. Since then I had paid the car off and now have title in hand, yet the bank will not release the funds until I have the car repaired. Are they allowed to do this even though they no longer have interest in the vehicle? They want repairs first which I can't afford out of pocket.