To obtain a mortgage loan from a bank (or any other lending organization), taking out borrower insurance is often necessary. Establishments require, in the vast majority of cases, this coverage, because it allows them to protect themselves against hazards and possible risks that could cause non-payment problems.
Generally speaking, professionals offer their clients a so-called group contract. However, subscribing to this automatic policy is not obligatory since, thanks to the principle of delegation of insurance, borrowers can turn to an independent insurer and opt for an individual contract.
Furthermore, in accordance with the Lemoine law, they also have the possibility of changing loan insurance at any time, upon signing the loan and throughout the duration of their loan.
Do you want to invest in real estate and have you taken out a loan to supplement your funds? However, in doing so, you also took out group insurance and now want to change coverage? Here are two good reasons to take the plunge and opt for an individual contract in 2023.
Insurance better suited to your profile and your needs
Since it is aimed at the greatest number of people, the group insurance offered by banks and lending organizations is very general.
In principle, this type of coverage is designed so that the risks are shared between the different borrowers. This characteristic means that the protection it offers is often poorly adapted, or even unsuitable, to the needs of policyholders.
By choosing to change your policy, and therefore opt for the services of an independent brand, you will have an individual contract, with a TAEA (effective annual insurance rate) specific to your personal, professional and economic profile.
Currently, many borrowers are turning to a specialized insurer because they want to benefit from a tailor-made package. The conditions for this type of coverage are much more advantageous than those of traditional offers. Since loan insurance is tailored to the expectations and profile of the insured, it guarantees better protection.
Great savings on monthly payments
In the vast majority of cases, borrower insurance offered by banks and lending institutions is calculated on the total amount of the loan. This method of calculation means that, with equivalent guarantees, it can be up to three times more expensive than external offers. When we know that the coverage can represent up to 25% of the cost of the real estate loan, we can easily deduce that the insured can make very good savings if he chooses to change brand and opt for an individual contract .
By choosing to subscribe to the offer of an independent specialized insurer, you will be able to divide by two, or even by three, the cost of your loan insurance. With a good policy, you can save hundreds or even thousands of dollars.
In addition, you will also have the possibility of balancing your budget according to your age and your financial situation (depending on whether you have chosen a decreasing premium or a smoothed premium over the entire duration of the credit).
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