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Since 2010, it is easier to change borrower insurance contract
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Since 2010 and the entry into force of the Lagarde law, it is easier to change loan insurance contract. If the majority of borrowers still favor group contracts for practical reasons or a lack of knowledge of the regulations, delegation is a solution that offers many advantages. In 2014, the Hamon law strengthened consumer rights by making it possible to terminate a loan insurance contract at any time during the first year. Since 2018, it is to the Bourquin amendment that we owe the annual termination, now authorized on each anniversary date. More recently, at the end of 2020, insurance professionals and households hoped that the 2021 finance bill would include the possibility of terminating one’s borrower insurance contract at any time, as is the case now exists for complementary health insurance. A proposal ultimately rejected, but which could be debated again in the coming months.
Nevertheless changing loan insurance has never been easier. For borrowers with low health risk in particular, this is a good way to achieve significant savings. First-time buyers or households wishing to optimize their level of guarantee, can seek the advice of a loan insurance broker to find the guarantees and the most advantageous rates according to their family, medical and professional situation.
Decreasing monthly payments more advantageous in the long term
Another advantage of opting for delegation of insurance is to benefit from contributions calculated according to the outstanding capital (CRD). This is called decreasing monthly payments. Ultimately, this allows you to benefit froma more substantial remain to be lived, which can be particularly interesting for couples who plan to have a child or households who have projects requiring medium-term liquidity. On the whole of the contract, the declining monthly payments calculated on the outstanding capital allow to make savings.
The borrower insurance contributions calculated on the outstanding capital make it possible to pay monthly installments that decrease each month. However, these can be reassessed during the contract depending on the age and state of health of the borrower.
Be careful, however, at the start of the contract, the monthly payments for the borrower insurance are higher in this case. With equivalent guarantees, a group contract can then be more advantageous during the first years of repayment. A particularity that must be taken into account in the event of resale and therefore early repayment of mortgage. What is more, it is precisely during the first years that the professional situation of households is the least advantageous, whereas it generally tends to improve over the years.