Unfortunately, that's the terms on which BT delivers Home Hubs to customers.
Many years ago, BT would lend an ADSL model to their broadband customers. If it broke, BT would send out a new one. At the end of the contract, they would ask for it back.
Then they changed the terms. The Home Hub is actually sold to you as part of the package. All the time you are a customer, they defer any payments for it. After one year, the Home Hub is yours and they write off the cost. What that means is that if the Hub goes wrong, and it's out of warranty, then it's your problem, not theirs.
I suggest you read the Sky terms and Conditions carefully. I've just had a look, and sure enough the Sky home router only comes with a 12 month warranty. You may have just the same problem again in future.