When you take out a consumer loan, there is talk of insurance coverage in the event of problems. Which ones are we talking about specifically? Which are mandatory and optional? Do the services differ between banks or are they the same for all? When and for what duration do insurances come into action?
Compulsory and optional insurance
Compulsory death insurance
Death insurance is the only compulsory insurance. It is included in the interest rate.
Highly recommended optional insurance
Regarding health / accident and unemployment insurance, we advise you to take them all, especially if you have borrowed a large amount. If you take the risk of not subscribing to one, make sure that with 30% less income, you can be able to repay your monthly payments without affecting your basic needs.
In the event of death, the credit is purely canceled and the insurance company reimburses the bank for the entire amount lost. And if you are married or living with a partner, do not worry, your spouse will have absolutely nothing to reimburse!
The benefits linked to death insurance are governed by the law on consumer credit, and are therefore identical for all banks.
Health and accident insurance
Differences between banks: the initiation of support
When does health and accident insurance take effect if you have a health problem that prevents you from working while you are repaying a loan?
First of all, the contract must run for at least 3 months.
Then, the period from which the insurance will start depends on one bank to another. As a general rule, insurance takes place from the 4th month after the health problems have occurred. To give you an example of a special case, the insurance of the Good Lenders Bank will pay your monthly payments only from the 7th month.
Coverage can extend up to 2 years maximum, the legal deadline. Then it is the disability insurance that you decide.
To be entitled to unemployment insurance, your contract must also run for more than 3 months.
Then, insurance only comes into play if your situation meets the conditions for obtaining unemployment benefits, such as having been laid off and having worked full time for the previous 12 months.
Finally, the maximum period of cover is 2 years.
Differences between banks: amounts reimbursed
Unemployment insurance from all banks reimburse your entire monthly payment, except the BCG which will only reimburse 50% of your monthly payment.
PS: the deadlines mentioned in this article are purely indicative.