Easier to switch mortgage insurance

HOMEOWNERS who take out a mortgage will have a year to switch provider for their repayment insurance, under new measures presented this week.

A new consumer protection law aims to make it easier for buyers to seek out a competitive rate with a different provider from the bank which granted the mortgage.

From the date the mortgage documents are signed, buyers will be able to look for a better deal for the compulsory insurance, and find a lower premium - provided the new insurer offers the same degree of protection.

Consumer group UFC Que Choisir has long campaigned for more competition and transparency in the insurance market. It believes buyers could save up to €1,500 over the course of their loan.

Consumer affairs minister Benoît Hamon said: "The aim is to cut the cost of insurance, which often represents up to a third of the total cost of the loan repayments."

It means buyers will not be rushed into taking the first insurance package their bank offers them.

Since 2010, homeowners have been free to choose who insures them against repayment problems - instead of being bound to get insured by the bank that offered the mortgage.