To finance your real estate acquisition, you will have to take out a mortgage loan from a lending institution. These contracts usually last for decades and no one can predict what will happen by the full repayment of the loan.
So that you do not lose your home in the event of serious accidents, the bank will systematically ask you to buy a borrower insurance.
The latter takes over the repayment of your loan if one of the borrowers dies or an accident prevents them from working and therefore to receive income to repay your loan. However, there is not just one type of home loan insurance or a single degree of coverage.
The Credither Guide describes in this folder all the possible options so that you have all the keys in hand when choosing your credit insurance.
- Death, disability, unemployment, PTIA, disability: understand the different levels of coverage.
- What is the quota?
- Group insurance or individual insurance?
- Lump sum or indemnity guarantee?
- How much does a borrower insurance cost?
Our tip: compare mortgage loan insurance offers
The legislator has introduced several measures to improve the information and comparability of borrowers. The goal is of course to give them the best conditions for their mortgage insurance.
These measures concern:
- The possibility for borrowers to choose a credit insurance other than that issued by the lending institution (this is referred to as insurance delegation). One condition however: the guarantees offered by the new establishment must be identical to or superior to those issued in the initial offer. This provision is part of the Lagarde law passed in 2010;
- The obligation for the loan insurance organizations to indicate in their bids the TAEA (effective annual rate of insurance), which is the actual cost of the insurance. The latter must be expressed as a percentage, in cost per period (per month for example) and in total cost in euros;
- The possibility of terminating the mortgage loan insurance within 1 year after the signature. This provision has been effective since July 26, 2014 following the adoption of the Hamon law.
- The possibility as of March 1, 2017 to terminate his insurance on the anniversary date of the contract.
To find the best loan insurance solution, you can use our mortgage insurance comparator.