In the context of a mortgage, the insurance rate is expressed by the effective annual rate of insurance or TAEA. To set it, insurance organizations and banks refer to criteria such as the age of the subscriber, his professional situation or the duration of the loan. This rate greatly influences the total cost of debt insofar as it can reach more than 30% of the cost of credit. Benefiting from the best rate allows you to realize your project in the best possible conditions.
The loan insurance rate is an indicator that calculates the cost of your insurance in relation to the total cost of the debt, that is to say, the borrowed capital added to the interest. Generally, the more a profile presents risks, the more this rate increases. However, depending on the insurance organizations, the prices are likely to vary. This is because each insurer has their own interpretation of a given risk. However, as a general rule, age is a determining factor.
Currently, for a standard profile, the rate can range from 0.38 for a borrower under 35 years old to 1.84 for a borrower over 55 years old. Moreover, there is a significant difference between the rates charged by insurers, which can be explained by the fact that there are two kinds of insurers. Indeed, the insurers attached to the lending bank will want to compensate for the drop in credit rates by increasing the rate of loan insurance. On the other hand, external insurers are free to set their rates. To find the best rate, it will therefore be necessary to make a small comparison between the proposals available on the market using a comparator.
To determine which rate will correspond to your profile, the company will base itself on 3 main criteria, including medical risk. This risk is related to the age, state of health and medical history of the applicant. Whether or not you smoke will also come into play in the pricing of the insurance premium. On the other hand, there are occupational risks which are not negligible. If you have a risky trade, this will be reflected in your insurance rate.
The functions considered to be the most risky are those related to security, whether public or private, construction trades, trades requiring significant physical effort and many others. Each insurer has its own list of dangerous occupations. It is up to you to inform yourself of this before requesting a quote. In addition, there are also the risks of activity and leisure. If, for example, you practice an extreme or risky sport, an increase in the insurance rate is applied.
In order to benefit from the most advantageous rate for your mortgage loan insurance, it is recommended to go through the delegation of insurance. This consists of taking out your loan insurance elsewhere than with your bank. Indeed, the bank's group insurance is generally twice as expensive as that offered by an independent company. This is a right you can exercise even if you have already purchased group insurance.
All you have to do is know the conditions for terminating the group insurance and proceed with the termination to take out the guarantee with the insurer of your choice. The only condition that you must meet for the delegation of insurance to be accepted is the equivalence of the guarantees offered by the independent company and the lending bank. In order to increase your chances, do not hesitate to go through an online loan insurance comparator.
