Since September 1, the Lemoine Law has allowed all borrowers to change their mortgage loan insurance at any time. A significant advance, as credit institutions have so far tended to take advantage of the situation.
We no longer present it. Law No. 2022-270 of February 28, 2022 for fairer, simpler and more transparent access to the borrower insurance market, more often called the Lemoine law, has transformed the landscape of loan insurance. Since September 1, each individual who has insured his mortgage can decide, at any time, to change loan insurance. Until now, this possibility of termination was limited to the first year of credit and then the anniversary date of the contract to hope to change it.
Shorter lead times
In a study published at the end of October 2022, the Scurimut site, a specialist in borrower insurance, returned to the obstacles raised by the Lemoine Law. The first relates to deadlines. Indeed, the bank has a legal deadline of 10 working days, counting from the reception of the request for substitution of insurance by the borrower to answer it. Based on its 2021 data, Scurimut thus notes that one out of three requests received no response within the legal time limit of 10 days. Worse still, one in six requests was not processed after 30 days, or even never received a response.
However, the Lemoine law seems to have changed this parameter. Christophe Boich, director of insurance at the broker Meilleurtaux, confirmed at the end of August MoneyVox an improvement in the deadlines, even if the bar of 10 days then seemed difficult to maintain. The infra-annual termination provided for by the Lemoine law could improve processing times because these were often used to deny requests for substitutions or make them pass out of time, notes from his side Securimut.
More complete answers
In its study, Scurimut also explains that for the year 2021, and despite sending all the necessary documents, nearly 60% of requests receive an incomplete response. It may, for example, be a refusal not accompanied by explanations. But, again, article 2 of the Law of 28 February henceforth stipulates that any refusal decision is explicit and includes all the reasons for refusal. It specifies, where appropriate, the missing information and guarantees. What facilitate the change of the borrower, which can more easily find another contract with the expected guarantees. As a reminder, the new insurance contract must in fact provide at least equivalent guarantees, ie it must cover the same situations (death, disability, etc.) as the previous contract.
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A balance of power that is slightly reversed
Scurimut returns to other anti-competitive banking practices, in particular the pressure sometimes put on borrowers to impose the group contract of the establishment instead of a delegate insurance. While it has become increasingly difficult to obtain a mortgage in recent months, the banks are indeed in a position of strength and borrowers often ready everything. Thus, according to the Scurimut study, more than one in two borrowers give up exercising their choice (to take out delegate insurance) at the time of the loan and prefers to change loan insurance after signing the loan, as the negotiation is unbalanced.
While today, banking establishments hold 88% of the loan insurance market, according to Securimut, the Lemoine Law, without completely reshuffling the cards, still allows borrowers to be able to accept the contract from the bank and to change it as soon as the credit is signed if the rates are really abusive, for example.
If the study therefore shows many positive advances, a fear remains: while borrowers must present an equivalence of guarantees to be able to change contract, Scurimut estimates that the banks could use erroneous objections on the equivalence of guarantees to slow down insurance changes.