Despite very significant savings, borrowers are still massively ignorant of why and how to compete to insure their mortgage. This borrower insurance is required by banks to prevent repayment defaults in the event of death, disability or loss of autonomy of the borrower.
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Profile of borrowers
Respondents to our survey (1) borrow an average of € 165,000 over twenty years. More than a quarter of them use a broker to find a loan on better terms than with their banker. This trend has increased in recent months since banks tightened their lending conditions. Going through a broker can also become the only way to access establishments that accept less secure profiles.
Loan negotiation
Whether they use the service of a broker or not, the French have become accustomed to negotiating certain points of their mortgage, in particular the interest rate (70% of those questioned). However, be careful, the interest rate, including the APR, the annual percentage rate of charge, can ignore certain costs (certain optional guarantees of borrower insurance, for example) which will ultimately increase the cost of the loan. cost of credit. It is thus necessary to be extremely vigilant and to integrate in the calculation of the rate all the expenses, the most direct as the most hidden.
Also pay attention to the counterparts requested by the banks: subscription to home insurance, life insurance, etc. Whereas previously many establishments were satisfied with the domiciliation of accounts, the trend is towards the prescription of ancillary contracts. Which are not always, far from it, the most competitive on the market.
→ How much can you save on your borrower insurance?
Partial information on borrower insurance
Loan insurance represents on average 20 to 40% of the cost of credit. But this important information is often very poorly understood by borrowers. 8 out of 10 people say they do not know the cost of their insurance. This is understandable when we seek to know what is the main source of knowledge of the French on the insurance of their loan: it is, in 60% of cases, the banker. However, the latter has no interest in insisting on this point. Group insurance offered by banks is generally much more expensive than individual insurance offered by alternative insurers. Thus, today more than 80% of French people still ensure their credit through their banker.
Poor knowledge of insurance delegation
For the past ten years, the law has given customers the possibility of replacing the borrower insurance offered by the bank with an insurance delegation. This substitution is possible either when the contract is taken out, or after signature. However, 35% of borrowers still do not know that this possibility exists. And more than 70% don’t know when to make the request.
Lack of awareness of achievable savings
The respondents’ lack of knowledge of insurance delegation is certainly linked to the importance of the banker in providing information … But perhaps also by a relative lack of interest on the part of borrowers. The majority of them (62%) are in fact unaware of the possible savings by opting for delegation.
However, the average amount that can be saved by changing borrower insurance is not negligible. It reaches an average of € 4,000 for borrowers who have had recourse to delegation!
(1) Inquiry What to choose carried out in April 2021 with a representative sample of French borrowers of 1,003 people.
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