Do I need to renegotiate my borrower’s insurance?

From 1 June, it is possible to change insurers at any time. The reform will strengthen competition between banks and insurers. How to hire a contract changer.

Nine women for homeowners. From June 1, they can change borrower insurance (mandatory for a home loan) at any time and at no cost. The reform, based on the Lemoine law passed in February, aims to strengthen competition in this market, which is largely dominated by banks (88% market share) that lend. The expected savings for the change of insurance include between 5,000 and 15,000 euros on average during the loan period. Good news in times of high inflation that weighs on purchasing power. Instructions for use of the reform.

Borrowers’ lives are greatly simplified. They no longer have to wait until the anniversary of their contract to knock on the door of a new insurer. Initially, only those who took out a real estate loan from June 1 could face competition. The reforms apply to all existing appropriations from 1 September. All you have to do is contact a new insurer or a new bank to change your contract. Like what is already possible with car, home or health insurance. „One in two borrowers say they are ready to change contracts and 40% of them admit that they would save as much as 1000 euros over the term of the loanpoints out Pierre Etchegoyen, an insurance consultant at Sia Partners. Young people are more likely to take the plunge. ”

  • Deletion of the medical questionnaire

In order to promote equality between borrowers, the Lemoine law abolished the health questionnaire for real estate loans of less than € 200,000 (€ 400,000 for two) and repaid before the borrower’s 60th birthday. Beyond that amount, individuals continue to answer questions about their health and perform medical tests as needed. On the other hand, for former cancer or hepatitis C patients, the “right to be forgotten” period, which allows them to no longer have to report their illness to their insurer, increases from ten to five years.

  • What will be the main beneficiaries of the changes?

The contracts of people borrowing less than 200,000 euros without a medical questionnaire can see their price go up. “Failing to assess borrowers’ risks as closely as possible with the medical questionnaire, insurers and bankers will increase loan insurance rates below € 200,000, at least initially”, predicts Éric Maumy, president of broker April. Tariff increases can range from 5 to 10% on average, see more. “Contracts will be more segmented depending on the age of the borrower”, adds Eric Maumy. Unsurprisingly, the younger ones will pay less than the older ones. « The risk is that the abolition of the health questionnaire will lead to an increase in tariffs, which will have an impact on all borrowers and, in particular, on the fewer young people who pay less. confirms Maël Bernier, spokesman for Meilleurtaux.

Healthy individuals, non-smokers and borrowing more than 200,000 euros (will be subject to the medical questionnaire) should be the winners of the reform. “Individuals who have taken out a loan between 200,000 and 500,000 euros are the ones who will have the most appetite to change their contract”explains Michaël Donio, associate at Sia Partners.

On the other hand, a change in insurance is of interest only for real estate loans that are still quite long (three-quarters of the loans according to some brokers).

  • How will competition be strengthened?

Bankers and insurers are at war. “Many insurers will go on the offensive, especially those who are very advanced in home insurance”, notes Pierre Etchegoyen. The name of them is preparing for the launch of extensive advertising campaigns from the beginning of September to inform the Frenchman, who can change the borrower’s insurance at any time. In this way, they hope to gain 5 to 10% market share in the banks. Sensing the threat, they are already reacting. On Tuesday, La Banque postale and its subsidiary CNP Assurances announced a freeze on borrower insurance rates. These two establishments also eliminate certain “surcharges” charged to people with an aggravated health risk.
Other similar banking initiatives can be followed.

Courtiers are also enjoying the reform, as are certain insurance companies specializing in home insurance (Luko, Aumax) with competitive offers.

Borrowers must quickly take advantage of the growing competition between insurers and bankers.


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