Borrower insurance

Take out borrower insurance in Nice

Borrower insurance is insurance that you must take out when you sign a mortgage agreement with a bank. It protects you by settling your home loan in the event of death or disability.

Why should you change your borrower insurance? What steps should you take to terminate your contract? Your Hestia Finances Investissements insurance broker can answer these and all your other questions.

What is borrower insurance?

Borrower insurance makes it possible for your mortgage to be settled in the event of death, illness, disability or loss of employment. It covers you as an individual but is also a guarantee for the bank.

In purely legal terms, borrower insurance is not compulsory. However, no bank will approve your mortgage application without protecting themselves. Our insurance brokers are there to help you to make an informed choice in this matter.

Borrower insurance can account for up to 30% of the total amount of your mortgage! Our role is to advise you in your choice, based on your borrower profile, as well as to make the best possible forecast of the problems that you may face in the years following the signing of your mortgage.

Group insurance or individual insurance?

When you go to sign your mortgage, you will be given the choice of two options:

  • Take out a group insurance contract, in other words that of the bank – your monthly insurance payments will be added to those of your mortgage. This option is the one most often offered by banks due to it being so practical to implement, but it is often more expensive than delegated insurance.
  • Take out individual borrower insurance (delegated insurance) with an insurer or a specialized organization. This lengthier option requires that you find your own organization – and this is where our brokers can assist you. These insurance products can be tailored to your needs, which means you are individually protected.

Renegotiate your borrower insurance

It may become necessary to terminate your mortgage insurance contract in order to benefit from more attractive rates, get better cover for the same price or save on the cost of insurance while benefiting from the same guarantees. Whether you are a real estate professional or an individual, we will renegotiate your monthly insurance payments for you and find the contract that suits you best. We work in close collaboration with notaries and accountants.

Terminate your borrower insurance contract

Looking to terminate your mortgage loan insurance contract to benefit from a more attractive offer? There are three laws governing this possibility.

The Lagarde law: the right to take out the insurance of your choice

The Lagarde law was implemented in 2010. Before this date, borrowers had no choice but to accept the borrower insurance offered by the bank with which they have taken out their mortgage. Thanks to this law, it is now possible to choose a delegated organization of your choice, provided that the guarantees of the individual insurance contract are equivalent to those offered by the bank.

The Hamon law: the right to cancel your insurance contract in the first year

Cancelling your insurance contract during the first year is now possible thanks to the Hamon law, adopted on 17 March 2014. This law applies to all loan offers signed from 26 July 2014.

However, there are certain conditions that must be observed:

  • you must change insurance in the year following that in which you signed your home loan,
  • you must request it by registered letter with proof of receipt at the latest 15 days before the end of this first year,
  • the new borrower insurance must contain guarantees at least equal to those which previously covered you.

The Sapin II law: the right to change borrower insurance after the first year

Adopted in 2017, the Sapin II law now allows signatories to a mortgage to change borrower insurance after the first year of taking out the loan.

Furthermore, the borrower can change insurance after the first year of their insurance policy – but here again, there are certain conditions to observe:

  • the change can only be made on the anniversary date of the contract,
  • for group contracts, this anniversary date corresponds to the date of signature of the mortgage,
  • for outsourced contracts, this anniversary date corresponds to the annual termination date provided for in the contract,
  • as with previous laws, the new contract must cover at least the same guarantees as the previous one.