When buying a property in France you automatically look at the interest rate first – it is what everybody does! However, your mortgage life insurance deserves just as much attention and is something that is frequently overlooked. Reviewing this cover could reduce your overall borrowing costs whilst keeping you and your family protected.
Known as assurance emprunteur, French mortgage life insurance can repay all or part of your outstanding loan following death or total and irreversible loss of autonomy (the most frequent covers for non residents and expats) or mortgage repayments in other insured circumstances. Depending on the policy, protection may include permanent disability and temporary incapacity for work. The precise definitions, exclusions and payment conditions vary between contracts and will depend on your personal circumstances and residency.
This is different from assurance vie, the French savings and investment product which is hugely popular in France as generally tax efficient. Mortgage insurance specifically protects your borrowing commitments and is linked to your property loan.
What changed with the Loi Lemoine?
The Loi Lemoine made changing mortgage insurance considerably easier. Since September 2022, borrowers with eligible residential mortgages have been able to replace their insurance at any time, including policies arranged before the law took effect. There is no need to wait for an anniversary date or complete the first year. Your replacement policy must meet your lender’s minimum coverage requirements.
What does it enable you to do?
- Change insurer whenever you wish. You can review your cover throughout the mortgage term without needing to wait a year or for the anniversary date.
- Cancel without cancellation fees. Your bank also cannot charge for assessing the replacement policy or issuing the mortgage amendment.
- Keep your mortgage conditions. Choosing an alternative insurer cannot justify increasing your mortgage interest rate or changing your agreed loan conditions.
- Shop around for potential savings. Comparing providers may reveal a lower premium for equivalent protection.
- Reassess your protection. You can explore stronger guarantees or more suitable cover, subject to underwriting and lender acceptance.
The law also improved access to insurance. No health questionnaire or medical examination can be required when your cumulative insured mortgage share does not exceed €200,000 per person and repayment finishes before your 60th birthday. These conditions apply together; the threshold concerns each person’s insured share across relevant outstanding loans.
For eligible applicants previously affected by cancer or hepatitis C, the right to be forgotten now applies five years after treatment ends, without relapse, subject to the applicable AERAS conditions, including the insurance ending before age 71.
How do you change your insurance?
Start by gathering your mortgage offer, repayment schedule and existing insurance details and contact us. As brokers, we will take the hassle out of changing for you and compare the remaining total cost, insured percentages for each borrower, exclusions, waiting periods and claim definitions. A cheaper monthly premium alone does not establish that a policy offers suitable protection.
Next, we submit the replacement contract to your lender for approval. The bank has ten working days from receiving a complete application to communicate its decision. Any refusal must be explained. We’ll coordinate cancellation and the new policy’s start date carefully to avoid a gap in protection.
Would you like to know whether you could save?
We can review your existing insurance, compare suitable alternatives and manage the change with your lender. The aim is straightforward: appropriate protection, clear comparisons and potential savings over your remaining mortgage term.
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