It has been three years since the Finance law allows real estate borrowers to take out loan insurance other than that of the lending bank. On this occasion, the UFC-Que Choisir takes stock of the device.
Ability to sign the borrower insurance
Initially, the ability to sign the borrower insurance in another institution was to promote competition and thus lower prices. Except that, first observation, the first three providers of credit continue, three years after the introduction of the law, to dominate the market of the insurance of loan.
More than half of the contributions are indeed paid, and the share of alternative organizations (other than banks) has even declined, from 20% in 2009 to 14% in 2011.
A larger share of the total cost of credit
On the other hand, if there is one position that has not declined, it is the share of credit insurance in the total cost of a loan. ” This share has been growing strongly for the past five years, mainly because of the lower cost of credit,” says UFC-Que Choisir. Most credit players agree that borrower insurance represents around 25% of the total cost of credit.
To foster competition in this market, the UFC-Que Choisir expects a lot of the banking law 2013 soon adopted by Parliament. In particular, the text prohibits banks from charging fees for the analysis of alternative contracts. Another provision provides for the annual cancellation of the borrower insurance.
Pending the final adoption of the device, there is a way today to have the best conditions in credit insurance: to use a broker (such as the Credither Guide, Ed). This is in fact the finding of UFC-Que Choisir, for whom ” only the intervention of credit brokers, with bargaining power with banks, seems to facilitate the subscription of a borrower insurance delegate.”