Borrower insurance guarantees the repayment of a mortgage loan when the borrower can no longer meet their payments due to death, disability, or incapacity to work. No law mandates it, but banks systematically require it before granting financing. Its cost can represent a significant portion of the total loan amount, making it a line item to examine with as much rigor as the interest rate itself.
Disability thresholds and compensation methods: the clauses that change everything
Most borrowers compare rates. Fewer read the conditions for triggering the guarantees. A contract may display an attractive price and refuse any compensation in the event of a claim simply because the disability rate does not reach the stipulated threshold.
The Financial Sector Advisory Committee (CCSF) has recommended reference thresholds of 66% for total disability and 33% for partial disability. These benchmarks aim to make contracts more comparable. Before this recommendation, each insurer freely set its own thresholds, making comparison almost impossible without rereading the notice line by line.
The method of compensation is another determining variable. A fixed contract pays a fixed amount corresponding to the insured portion, regardless of the actual loss of income. An indemnity contract only covers the difference between the original salary and the benefits already received (Social Security, provident insurance). A borrower well-covered by their employer might receive no indemnity under the indemnity mode while still paying their insurance premiums.
Choosing a suitable mortgage insurance therefore requires checking these two parameters even before looking at the monthly rate.
Exclusions from coverage in a borrower contract: common pitfalls
Exclusions are situations in which the insurer does not cover anything. They are listed in the information notice, a document often lengthy and written in technical terms. A few categories frequently appear.
- Back and mental health conditions are excluded by default in many contracts unless they lead to hospitalization or surgery. A work stoppage due to chronic back pain or depression may therefore remain uncovered.
- High-risk sports (skydiving, deep-sea diving, mountaineering beyond a certain altitude) are subject to exclusions or surcharges. Borrowers who regularly participate must declare it and negotiate an exclusion buyback.
- Claims related to a pre-existing illness not disclosed on the health questionnaire can lead to the contract being voided. Since the Lemoine law, the medical questionnaire is no longer required under certain conditions of amount and term, but beyond these thresholds, it remains mandatory, and its accuracy binds the insured.
Disputes related to borrower insurance accounted for 29% of claims recorded in the 2025 activity report of the Insurance Mediation. Misunderstood exclusions are the primary source of conflicts between insured individuals and insurers.
Insurance delegation and the Lemoine law: changing contracts without fees
Since the Lagarde law of 2010, a borrower can refuse the group contract proposed by their bank and subscribe to an external insurer. This freedom is called insurance delegation. The bank can only refuse an external contract if the level of coverage is lower than what it requires, assessed from the personalized sheet provided during the loan application.
The Lemoine law, which came into effect in 2022, removed the anniversary date constraints. Changing contracts is possible at any time, without fees or penalties. The procedure relies on three documents that the bank must provide:
- The standardized information sheet (FSI), provided at the first simulation, detailing the proposed guarantees and their estimated cost.
- The information notice, which constitutes the contractual document describing the rights and obligations of the insured.
- The personalized sheet, which lists the guarantees required by the lender and serves as a comparison grid to verify equivalence.
One point deserves attention during a change: the old insurer must continue to cover a claim reported before termination, including its direct consequences such as an aggravation of disability or a subsequent death. The CCSF clarified this principle in an opinion dated May 26, 2026, with generalization expected by June 1, 2027, at the latest.
Loan insurance share: distributing coverage among co-borrowers
When two people borrow together, the share determines the portion of the capital covered for each. A share of 100% on each head means that the death or disability of either one results in the full repayment of the loan. A 50/50 split only covers half of the remaining capital due in the event of a claim on one of the co-borrowers.
The choice of share depends on the income gap between the two borrowers. If one of them generates the majority of the household’s resources, an asymmetric share (for example, 70/30) better protects the co-borrower who could not manage the monthly payments alone.
Increasing the share raises the premium. The calculation is made by comparing the annual additional cost to the actual protection provided. On a long-term loan, the difference in premiums between 100/100 coverage and 50/50 can amount to several thousand euros cumulatively, but the lack of sufficient coverage may force a sale of the property in the event of a claim.
The report from the Insurance Mediation confirms this: claims often concern guarantees deemed insufficient at the time of the claim, while the share chosen at subscription was too low. Checking this parameter at the time of signing, and then during any contract changes, remains the most concrete precaution to avoid a gap between the coverage subscribed and the actual financial risk of the household.
