Insurance delegation
The right to take out borrower insurance with an insurer other than the lending bank, provided the cover is at least equivalent. It opens often substantial savings, especially for young, healthy profiles. The Lagarde, Hamon, Bourquin and then Lemoine laws have progressively widened access to it.
Key points
- The borrower's right to take out insurance outside the lending bank.
- The external policy must offer at least equivalent cover (CCSF criteria).
- Often generates substantial savings for young, healthy borrower profiles.
- The bank cannot refuse without grounds or change loan terms when delegation is chosen.
Frequently asked questions
How does the insurance delegation process work?
The borrower selects an alternative policy, then submits the standardized information sheet and the external policy summary to their bank for a CCSF-criteria comparison. The bank has a regulatory deadline to accept or refuse, with a reasoned decision; any refusal without serious justification can be challenged. If accepted, the alternative policy replaces the bank's group contract.
Why is insurance delegation advantageous for a young borrower?
Bank group contracts pool risk across all policyholders, which penalizes young, healthy profiles who effectively subsidize older or higher-risk insureds. By taking out an individual policy, a healthy 30-year-old borrower can see their premium cut in half or more. Over a 20-year loan, the saving can exceed several thousand euros.
What is the difference between insurance delegation and cancellation under the Lemoine law?
Insurance delegation is the original mechanism allowing a borrower to choose an external insurer at the outset or at the point of change. Lemoine cancellation is the now-permanent right to terminate the current contract at any time and take out a new one. The two mechanisms complement each other: delegation defines the framework of free choice, while Lemoine cancellation guarantees its scope over time.
In practice
A 34-year-old non-smoking borrower with no medical history is offered a group policy at 0.36% of the initial capital by her bank. Through delegation, an individual insurer offers 0.12% on the outstanding balance. On a €200,000 loan over 20 years, the estimated saving exceeds €8,000.
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Official sources
- Borrower insurance for a mortgage · Service-Public.gouv.fr
- Law of 28 February 2022 (Lemoine Act) · Vie-publique.fr