The good news is for future owners: The rules that govern borrower insurance have become more flexible as of Wednesday, June 1, according to the Lemoine law. This text was voted by Parliament last February. We will show you its concrete consequences.
It was difficult to end borrower insurance until now. You had to do this within 12 months of signing the loan agreement or on the anniversary of the contract. It is now possible to do this at any time, and it is free of charge, thanks to the Lemoine law.
What is the goal? The goal? The 7 billion euro borrower insurance market is 88% trustee by banks. This sector achieves an average margin 68% on contracts. To the benefit of all, prices will drop because there is more competition! Le Parisien Patricia Lemoine explains the deputy (Agir), at the source of the bill.
According to the text, switching insurers could help households save "5,000 to 15,000 euro" over the term of the loan. Attention! The new contract must offer equivalent guarantees to the existing one to allow this change to be accepted.
For all new borrower insurance contracts, this simplified termination will become effective on Wednesday, June 1. You will need to wait until September 1st for older contracts.
A medical questionnaire was required to obtain loan insurance. The medical history, risks, medical treatments, blood tests, urine analysis... This can be tedious. Some people find this discriminatory. For example, mortgage borrowers who are currently or have been diagnosed with a medical condition may be subject to additional premiums and/or loan refusals.
The Lemoine law, which was passed to remedy the unequal access to property has abolished the medical questionnaire for loans less than 200,000 euro per insured. For a couple, 400,000 euros. The maturity date must be before the borrower turns 60 years old. To determine the price of insurance for borrowers, there will no longer be any more than four criteria: age, occupation, smoking, and geographic area.
The Lemoine law, which also removed the medical questionnaire, strengthened the right of victims of serious pathologies to be forgotten. People who have had hepatitis C or cancer after 21 years, whose treatment protocol was completed at least five years ago, will no longer be required to notify their insurance.
These last two measures may inadvertently penalize other people if they are of benefit to sick or fragile individuals. Insurance companies, especially those that are not banks, won't be able as previously to evaluate risks and may increase their prices. Le Parisien Astrid Cousin warns that "total pooling will penalize an entire section of the population". This is according to the spokesperson for the broker Magnolia.fr.
