For many years, taking out a mortgage in France automatically meant accepting the Mortgage Insurance offered by your bank. Today, the situation is very different. Borrowers are free to compare policies, choose their own insurer, and potentially save thousands of euros over the life of their loan.
This transformation is the result of several major legal reforms that have gradually opened the French Mortgage Insurance market to competition. Here’s a look at the key milestones that changed the industry.
The 1960s : The Birth of Mortgage Insurance
As home ownership became increasingly popular in France during the 1960s, banks began offering insurance policies designed to secure mortgage loans.
At the time, these policies were distributed exclusively by banks. Borrowers had virtually no choice—the bank’s group insurance policy was automatically included with the mortgage.
The objective was straightforward: protect the lender in the event of the borrower’s death or disability to ensure the loan would still be repaid.
The 1970s and 1980s : Mortgage Insurance Becomes Essential
Over the following decades, Mortgage Insurance became an almost indispensable part of every mortgage application.
Coverage gradually expanded to include additional risks, such as :
- Death.
- Total and Permanent Loss of Autonomy (TPLA).
- Temporary Total Disability (TTD).
- Permanent Disability.
Despite these improvements, the market remained largely controlled by banks. Borrowers had very few alternatives, and insurance premiums were rarely negotiable.
The Lagarde Law (2010) : Competition Begins
A major turning point came in 2010 with the introduction of the Lagarde Law.
For the first time, borrowers were allowed to choose an insurance policy from an insurer other than their bank when taking out a mortgage. This principle is known as insurance delegation.
Banks could only refuse an alternative policy if its level of cover was not equivalent to the guarantees they required.
This reform marked the beginning of genuine competition within the Mortgage Insurance market.
The Hamon Law (2014): Changing Insurance During the First Year
Four years later, the Hamon Law strengthened borrowers’ rights even further.
It allowed borrowers to switch Mortgage Insurance at any time during the first twelve months after signing their mortgage agreement.
This gave homeowners who had initially accepted the bank’s insurance for convenience the opportunity to find a more competitive policy afterwards.
The Bourquin Amendment (2018) : Annual Cancellation Rights
In 2018, the Bourquin Amendment introduced another important change.
Borrowers became entitled to change their Mortgage Insurance every year on the anniversary date of their contract, provided that the new policy offered equivalent guarantees.
This encouraged insurers to develop increasingly competitive products and pricing.
The Lemoine Law (2022) : Greater Freedom Than Ever
The Lemoine Law is considered the most significant reform in recent years.
Since its introduction, borrowers have been able to change their Mortgage Insurance at any time, without waiting for the annual renewal date.
The reform also introduced several major benefits, including:
- The removal of the medical questionnaire for certain eligible loans.
- An expanded “right to be forgotten” for borrowers with specific previous medical conditions.
As a result, comparing Mortgage Insurance has become much easier, and the potential savings are often substantial.
What Do These Changes Mean for Borrowers Today ?
Today, borrowers are no longer obliged to accept the insurance policy offered by their bank.
Instead, they can compare policies in order to :
- Reduce the overall cost of their mortgage.
- Obtain cover that better suits their personal circumstances.
- Choose specialised insurance designed for expatriates or non-residents.
- Improve the overall cost of borrowing by securing a more competitive insurance premium.
A Practical Example
A French expatriate living in Canada obtains a mortgage to purchase property in France.
The bank offers a relatively expensive group insurance policy. After comparing different insurers, the borrower finds an individual policy offering equivalent cover at a significantly lower premium.
The result? Several thousand euros saved over the lifetime of the mortgage—without changing the loan itself.
Conclusion
Mortgage Insurance in France has changed dramatically over the past few decades. What was once a product distributed exclusively by banks has become a highly competitive market where borrowers now enjoy genuine freedom of choice.
For expatriates and non-residents, these reforms provide an excellent opportunity to obtain insurance that is better suited to their international profile while significantly reducing the overall cost of their French mortgage.
Would you like to know whether your current Mortgage Insurance could be replaced with a more competitive solution ? The experts at France Protect Insurance compare policies from leading insurers to help you find tailored cover that matches your property project—wherever you live in the world.