Bad news if you are subject to back problems: when signing a mortgage, the insurer who covers your loan very often refuses to insure you for the consequences of these pathologies. Explanations.
Holder of a mortgage, do you think you are covered in the event of back problems? If you have loan insurance, you have probably been asked the question, either directly or to find out if you have had a work stoppage in recent months. For what? To know if you suffer from an MNO, for non-objectifiable disease. What is this? MNOs include back problems and mental disorders, reveals Christophe Boich, director of borrower insurance at Meilleurtaux. These are pathologies that are not medically demonstrable.
These are all subjective diseases, which cannot be measured by a doctor, but which are all the same very real pathologies, develops Astrid Cousin, spokesperson for the Magnolia insurance broker. Back problems therefore fall within the scope of MNOs, in the same way as depression, burnout or chronic fatigue. They are pathologies on which insurers have great difficulty pricing.
Exclusions for borrowers who already have back problems
In this context, a study published in December 2022 by the Financial Sector Advisory Committee (CCSF) and devoted to borrower insurance notes that back and psychological pathologies are the subject of special treatment on the market, with the implementation of very variable geometry exclusions from one contract to another. They have historically been the cause of many creditor insurance claims and are considered to be a major reason for anti-selection.
Especially since non-objectifiable illnesses are the biggest cause of sick leave today. According to the National Health Insurance Fund (Cnam), quoted by Capital, low back pain (also called lumbago) would affect four out of five active people. Moreover, these are often repeated problems, continues Astrid Cousin. a therefore translates into lower wages, which can impact the repayment of the loan. A bad point for the insurer, whose goal is to take the least possible risk when covering you.
As a result, people who have already suffered from one of these pathologies will necessarily be considered as a profile with an increased risk. And very often, insurers simply refuse to cover the related problems. As soon as the borrower declares a back problem, there will be a partial exclusion because for the insurer, the probability of a new claim is too high. The borrower can therefore take out loan insurance, but it will not cover him for back problems, develops an insurer interviewed.
The insurer can also offer an additional premium or an exclusion buyout, which will depend on age and whether the problem is one-time or recurring, tempers the Magnolia spokesperson. But it’s case by case, it will depend on the insurer and your case. But in general, it is very expensive.
Many borrowers covered, even in the event of pathology
What about borrowers who, without having had any problems in the past, would suffer from a back problem during the contract? He is generally provided for coverage in the event of hospitalization, as there is a tangible, explains Christophe Boich. And there are redeemable options in certain contracts, which make it possible to be covered for back pain and mental disorders, even in the event of non-hospitalization. According to the director of borrower insurance at Meilleurtaux, more and more contracts now offer MNO coverage.
It must be said that in the event of the insurer’s refusal to cover a back problem that might occur with a customer, justice is on the side of the insured. For example, in a judgment delivered on June 17, 2021, the 2nd civil chamber of the Court of Cassation recalled that Article L. 113-1 of the Insurance Code requires that exclusions from cover be formal and limited.
In this case, a warranty exclusion clause, when it mentions and ‘other back pain’ is not considered formal and limited and cannot be enforced. This means that, in the presence of such a mention, the entire clause is considered null and any back pathology, including those explicitly mentioned in this exclusion clause, will be compensated, recalls the Court of Cassation.
Another deal came to reshuffle the cards: the Lemoine law. As a reminder, since September 1, 2022, many home loans no longer require a health questionnaire. The Lemoine Law has abolished the medical questionnaire provided that the insured portion of the cumulative outstanding balance of credit contracts does not exceed 200,000 euros per insured (400,000 euros for a couple) and if the total repayment of the loan is planned before the age of 60. the borrower. In these conditions, it is therefore no longer possible for the insurer to know in advance whether the insured has already had back problems. Hence, here again, the generalization in certain contracts of this MNO coverage.
One thing is certain: if you have already had back problems leading to a stoppage and your insurer asks you the question when taking out the loan, it is better not to lie. It would be a very bad calculation, confirms Astrid Cousin. If your insurer finds out, not only are you completely uncovered, but above all it could end your borrower insurance contract.