diff --git a/app/main/views/service_settings.py b/app/main/views/service_settings.py
index 7561967ac..7d003239f 100644
--- a/app/main/views/service_settings.py
+++ b/app/main/views/service_settings.py
@@ -706,14 +706,20 @@ def service_add_letter_contact(service_id):
     form = ServiceLetterContactBlockForm()
     first_contact_block = current_service.count_letter_contact_details == 0
     if form.validate_on_submit():
-        service_api_client.add_letter_contact(
+        new_letter_contact = service_api_client.add_letter_contact(
             current_service.id,
             contact_block=form.letter_contact_block.data.replace('\r', '') or None,
             is_default=first_contact_block if first_contact_block else form.is_default.data
         )
-        if request.args.get('from_template'):
+        from_template = request.args.get('from_template')
+        if from_template:
+            service_api_client.update_service_template_sender(
+                service_id,
+                from_template,
+                new_letter_contact['data']['id'],
+            )
             return redirect(
-                url_for('.view_template', service_id=service_id, template_id=request.args.get('from_template'))
+                url_for('.view_template', service_id=service_id, template_id=from_template)
             )
         return redirect(url_for('.service_letter_contact_details', service_id=service_id))
     return render_template(
diff --git a/tests/app/main/views/test_service_settings.py b/tests/app/main/views/test_service_settings.py
index fa7660f94..db890bdd5 100644
--- a/tests/app/main/views/test_service_settings.py
+++ b/tests/app/main/views/test_service_settings.py
@@ -2168,6 +2168,7 @@ def test_add_letter_contact_when_coming_from_template(
     mock_add_letter_contact,
     fake_uuid,
     mock_get_service_letter_template,
+    mock_update_service_template_sender,
 ):
     page = client_request.get(
         'main.service_add_letter_contact',
@@ -2201,6 +2202,11 @@ def test_add_letter_contact_when_coming_from_template(
         contact_block="1 Example Street",
         is_default=True,
     )
+    mock_update_service_template_sender.assert_called_once_with(
+        SERVICE_ONE_ID,
+        fake_uuid,
+        '1234',
+    )
 
 
 @pytest.mark.parametrize('fixture, data, api_default_args', [
diff --git a/tests/conftest.py b/tests/conftest.py
index 39d56b010..dd76991f1 100644
--- a/tests/conftest.py
+++ b/tests/conftest.py
@@ -270,7 +270,14 @@ def get_non_default_letter_contact_block(mocker):
 @pytest.fixture(scope='function')
 def mock_add_letter_contact(mocker):
     def _add_letter_contact(service_id, contact_block, is_default=False):
-        return
+        return {'data': {
+            'id': '1234',
+            'service_id': service_id,
+            'contact_block': '1 Example Street',
+            'is_default': True,
+            'created_at': str(datetime.utcnow()),
+            'updated_at': None
+        }}
 
     return mocker.patch('app.service_api_client.add_letter_contact', side_effect=_add_letter_contact)