Two French banks stop asking health questions on mortgage applications

Crédit Mutuel and CIC have stopped asking longstanding customers, under 62, for health details. Borrowers’ insurance premiums expected to fall

Woman's hand writing on questionnaire
Borrowers no longer discriminated against for health reasons

A health questionnaire which had to be filled out by all clients applying for a loan to buy a home has been done away with for longstanding customers of Crédit Mutuel and CIC.

The questionnaire has been used to discriminate against clients who have had diseases such as cancer, or even long-form Covid, and who have been offered loans only at, in some cases prohibitively, high insurance rates.

Read more Recovered cancer patients in France set to have easier access to loans

Now clients under 62 who have used Crédit Mutuel or CIC as their main bank account for at least seven years and who want to borrow less than €500,000 will not have to give health details.

Bank CEO Nicolas Théry said an estimated 97% of loans will be covered by the measure, and 150,000 customers each year.

It has been applied retroactively to people who were paying higher insurance premiums.

Risk to the level of €70million has been added to the bank’s books due to the measure.

Insurance firms want more competition

The move comes as parliament and the finance ministry have introduced laws to increase competition by making it easier for clients to change their loan insurance.

This follows a long campaign from insurance firms and brokers, who complained about banks telling clients they would not get a loan unless they agreed to insure it in-house.

Even though a new law has been in place for two years, allowing loan insurance contracts to be changed annually, 88% of loan insurance still comes from the same bank as issued the loan.

MPs are likely to change the law further to allow contracts to be changed at any time.

Crédit Agricole proposes there should be four different levels of loan rates. At present, it is legal for high-risk customers to be charged up to 30 times the amount of low-risk ones.

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