Lemoine Law: Switch Mortgage Insurance in France

Note: This content is specific to the French property market.

In France, Borrower Insurance (Assurance Emprunteur) is mandatory and expensive. It can cost as much as the mortgage interest itself and can represent up to 30% of the total cost of your loan. We fight to get 3.5% instead of 3.7% on the rate, yet the real hidden cost is often the insurance. Banks often push their own "Group Contracts" which are overpriced. The Lemoine Law (in force since 1 September 2022) is a game-changer: it gives borrowers far more flexibility and control over their mortgage insurance. It gives you the right to:

1. Switch Anytime: Cancel your current insurance and switch to a cheaper external provider at any moment, without fees, penalties or waiting for the anniversary date.
2. Right to be Forgotten: Cancer survivors only need to wait 5 years (instead of 10) to be treated as standard risk.
3. No Medical Exam: For loans under €200k (per person) ending before age 60.

The Problem: Paying for a Disappeared Risk

Insurance is calculated to cover the capital you owe the bank. However, in standard bank contracts ("group"), the premium is often fixed or calculated on the initial capital. This means that even after 15 years, when you have repaid half of your debt, you are still paying full price. You are insuring €200,000 when you only owe €100,000. For a €250,000 mortgage over 20 years, insurance can add up to between €15,000 and €30,000 depending on the provider and the insured's profile.

Before the Lemoine Law

Before 2022, changing insurer was bureaucratic and limited, which favoured inertia:

• The Hamon Law (2014) allowed switching during the first 12 months after signing the loan.
• The Bourquin Amendment (2018) extended that right, but only on the contract's anniversary date, with two months' notice.

Most borrowers therefore stayed with the insurance offered by their bank, which used that inertia to charge premiums well above the external market. Borrowers were often stuck with expensive policies, unable to switch without penalties or waiting for the anniversary.

What Changed with the Lemoine Law

Since September 2022, borrowers' rights have expanded in three ways:

• Switch at any time: no anniversary date, no minimum holding period, no mandatory notice. You can start the process today, whenever you signed your mortgage.
• No health questionnaire for smaller loans: for loans with outstanding capital under €200,000 per insured person (up to €400,000 for two insured people at 50/50) whose repayment ends before the insured reaches 60. Before, people with pre-existing health conditions faced much higher premiums or outright exclusions; this levels the playing field.
• Annual information duty: banks are legally required to inform clients once a year of their right to change their mortgage insurance.

Once you submit the new policy, the bank has a maximum of 10 working days to accept or reject it. It can only reject it with a concrete justification: that the new coverage is not equivalent to the current one. If the bank does not answer in that period, silence does not mean automatic acceptance, but there is regulatory pressure to comply. By law, the bank also cannot change your mortgage interest rate if you switch insurance, as long as you keep the same level of coverage.

The Savings

Switching from a bank's policy to a specialized insurer can save you 50% to 70% on premiums (some borrowers save up to 50%). On a standard loan, this equals €10,000 - €15,000 in total savings, and over the life of the loan it can translate to €10,000 - €20,000 or more.

The difference is structural:

• Bank group insurance is usually a fixed percentage of the initial capital, regardless of how much you have repaid. Even if your debt fell from €250,000 to €180,000, you keep paying on the original base.
• External insurers typically calculate the premium on the actual outstanding capital, so your premiums fall as you repay. You pay less when you owe less.

Concrete example on a €250,000 mortgage over 20 years:

• Bank insurance: 0.36% per year on initial capital = €900 per year = €18,000 over 20 years
• External insurance: 0.15% per year on outstanding capital, starting around €375 in year one and decreasing = estimated total of €7,000 to €9,000 over 20 years
• Potential savings: €9,000 to €11,000

For larger mortgages or higher bank insurance rates, savings can exceed €20,000 over the life of the loan.

👉 French Mortgage Insurance Calculator

Example of Savings

Let's say you have a mortgage of €200,000 with a bank's insurance policy that costs €1,500 per year. If you switch to a specialized insurer, you may find a policy that costs €750 per year. Over the life of the loan, this could save you €12,000.

Why Is the Bank's Insurance Often Expensive?

Bank insurance is often more expensive than that of third-party providers because the bank does not always offer the most competitive rates, and its group contracts pool risks. External insurers ("délégation d'assurance") are tailored and cheaper for young or healthy profiles. By switching, borrowers benefit from more competitive pricing and lower premiums.

How to Switch Your Mortgage Insurance

Switching under the Lemoine Law requires neither a financial advisor nor a lawyer. The process is straightforward and can be completed in a few weeks:

1. Gather your current documentation. Ask your bank for the exact details of your current coverage: percentages, waiting periods, exclusions. This is essential for the comparison.
2. Compare external offers. Use specialized comparison sites (such as Assurland, LeLynx or Meilleurtaux) to get quotes. Many automatically check whether the new policy meets the equivalence criteria.
3. Choose a policy with equivalent or better coverage. Make sure waiting periods and guarantee trigger thresholds are comparable, and review the terms and conditions of the new policy.
4. Sign the new contract with your chosen provider. Many external insurers notify the bank on your behalf.
5. Notify your bank. Inform the bank of your intention to cancel your current policy and send the new contract by registered letter with acknowledgment of receipt.
6. Wait up to 10 working days. If the coverage is equivalent, the bank must accept the new contract. If it rejects, ask for the reasons in writing.

What Does "Equivalent Coverage" Mean?

The bank can only reject your new insurance if the coverage is not equivalent. This is precisely regulated: the Comité Consultatif du Secteur Financier (CCSF) has defined a list of criteria. The basic guarantees any mortgage insurance must include are:

• Death (Décès): covers the outstanding loan balance if the insured dies.
• PTIA (Total and Irreversible Loss of Autonomy): covers permanent total incapacity preventing any work activity.
• ITT (Temporary Work Incapacity): covers temporary inability to carry out your usual occupation.
• IPT/IPP (Total or Partial Permanent Disability): depending on the contract's configuration.

When comparing policies, check that the new contract meets at least the same coverage criteria as the current one.

Benefits of Switching to a Third-Party Insurer

• Lower premiums: specialized insurers often offer lower premiums than banks
• More competitive pricing and significant savings
• Increased flexibility and control: choose a policy that meets your needs and budget, and switch at any time without penalty
• Improved coverage: you may find a policy with better guarantees than your current one

Eligibility and Requirements

• Have a mortgage in France with a bank's insurance policy.
• To skip the medical questionnaire: loan under €200,000 per person, ending before you reach 60.
• Pre-existing medical conditions: it depends on the condition and the provider, so check with several providers to see whether they will cover you.

Strategy: Early Repayment + Insurance Switch

If you make a partial early repayment, you reduce the Remaining Capital Due. Less capital due = less risk for the insurer = cheaper premium. The winning strategy combines two actions:

• Make an early repayment (via AmortiApp) to reduce the capital.
• Immediately change insurance by presenting this new reduced capital.

You win on both fronts: you pay less bank interest AND your insurance premium collapses. Early repayment also shortens the loan term.

The Simulation on Amorti

• Enter your credit into AmortiApp.
• Simulate an exceptional repayment of €10,000.
• Look at the new Remaining Balance.
• Use this new balance to request external insurance quotes (delegation).

Often, the savings on insurance alone "repay" part of your investment. It is a financial lever that few French people use.

How to Calculate Your Savings

• Determine your current loan balance and insurance premium.
• Use AmortiApp (or an online calculator, or a financial advisor) to simulate an early repayment and calculate the new loan balance.
• Request insurance quotes from external providers using the new balance.
• Compare the new premium to your current premium and calculate the savings.

Real-Life Examples

Example A, with early repayment:

• Current loan balance: €200,000
• Current insurance premium: €1,500 per year
• Early repayment: €20,000
• New loan balance: €180,000
• New insurance premium: €1,200 per year

The borrower saves €300 per year on insurance premiums, which adds up to €6,000 over 20 years.

Example B, 10 years into a €200,000, 20-year loan at 3.5%: you still pay insurance on the initial capital even though half the debt is repaid. An early repayment of €10,000 cuts the remaining capital to €90,000, and with the Lemoine Law you can switch for a lower premium, saving up to €500 per year.

Tips for Switching

• Don't wait: the sooner you switch, the sooner you start saving.
• Shop around: don't choose the first provider you find; research providers, compare policies and prices, and read customer reviews.
• Read the fine print: check what is covered and what is not.

Common Mistakes to Avoid

• Choosing the cheapest policy without checking equivalence. The most common and costly error: a justified bank rejection can cost you weeks and force you to restart.
• Ignoring waiting periods. Cheaper policies may have longer waiting periods (for example, ITT may only start after 90 or 180 days of sick leave, versus 30-60 days on your current policy).
• Not checking whether the premium is based on initial or outstanding capital. After 8-10 years of repayments, a premium based on outstanding capital can be far cheaper.
• Assuming the bank will inform you proactively. Although the law requires it, many banks comply very discreetly. The initiative must come from you.
• Not researching providers, not reading the policy details, or not switching soon enough, which means missing out on savings.

When Is the Best Time to Switch?

If you have been with your bank's insurance for more than a year and never reviewed it, the best time is now. Every extra month on an expensive policy is money you will not recover. The Lemoine Law removes any cost or penalty for switching, so there is no reason to wait: the more years left on the loan, the greater the accumulated savings. If you signed your mortgage in the last 2-3 years with the default bank insurance, you are very likely in the highest-savings scenario.

Summary of Key Takeaways

• The Lemoine Law allows you to switch your mortgage insurance at any time, without fees or penalty.
• Switching can save you 50% to 70% on premiums, typically €10,000 - €15,000 and potentially more than €20,000.
• Borrower insurance can represent up to 30% of the total cost of your loan.
• The bank must accept the new contract within 10 days if the coverage is equivalent.
• Early repayment plus an insurance switch gives double savings.
• You should research providers and read the policy details before deciding, and switch as soon as possible.

Frequently Asked Questions

• Can I switch my mortgage insurance at any time? Yes, the Lemoine Law allows you to switch at any time, without fees or waiting for the anniversary date.
• How much can I save by switching? Up to 50% to 70% on premiums by moving to a specialized insurer.
• Do I need a medical exam to switch? No, if you meet the requirements of the Lemoine Law (loan under €200,000 per person, ending before age 60).
• Can I switch if I have a pre-existing medical condition? It depends on the condition and the provider; check with different providers to see whether they will cover you.
• What are the benefits of switching to a third-party insurer? Lower premiums, more competitive pricing, flexibility and potentially better coverage.
• How do I apply for a new provider? Compare external offers, send the new contract to your bank, and the bank must accept it within 10 days if the coverage is equivalent.

Conclusion

If you own property in France, reviewing your mortgage insurance is probably the most profitable financial move you can make. The Lemoine Law gives borrowers more flexibility and control: by switching to a third-party insurer, or combining it with an early repayment, you can save thousands of euros. Carefully review and compare offers, and consult official resources, financial advisory services or borrower forums if you want personalized guidance. Don't let the bank win on all fronts: recalculate everything. Don't wait: simulate your new capital today and start saving!

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