Credit insurance is a financial product that is designed to secure the interests of both the customer and the bank. You should know that in some situations you can opt-out of insurance and recover the premium. Read on and find out if and when you can get your insurance back.
When you take out a loan, you should ask yourself if you want to insure yourself or not. One should know that the policy protects the borrower in the event of death or permanent loss of health, but also generates higher fees.
What is credit insurance?
Insurance is additional security for the bank, which guarantees repayment if something bad happens to the borrower. For the bank, this is also an additional income.
The most common bank insurance:
Life insurance (in the event of death) – the policyholder repays the loan in the event of the death of the insured.
Permanent invalidity insurance – the policyholder repays the loan in the event of the insured person having an accident, and thus unable to work for a living.
Insurance against job loss – the policyholder undertakes to pay several installments if the borrower loses his job through no fault of his own.
Insurance against incapacity for work – a solution similar to the insurance against permanent invalidity, but extended to include the occurrence of illness and does not have to cause an accident.
Low own contribution insurance
Real estate insurance
Bridging insurance – protects the bank until it is entered in the land and mortgage register
Can I claim a refund of credit insurance?
Yes. You can. In some cases:
– early repayment of the loan
– willingness to cancel the policy while paying the debt
– termination of the loan agreement by the bank
If the insurance premium has been paid once for the entire duration of the loan – you can apply for a proportional refund for the period of protection that was not used. This is regulated by article 813 of the Civil Code.
Similarly, in a situation where the premium was paid monthly. In this case, we also have the right to a refund, and the bank is required to make a fair settlement.
The application for refund of the insurance premium should be directed to the institution where we signed the insurance contract, i.e. to the bank. It is the bank’s responsibility to return any unused funds to the customer’s credit account and reduce the debt balance by this amount.
How do you opt-out of credit insurance?
The first step will be to write an appropriate application to the bank. The application should include all contact details, as well as PESEL (personal identification number), Polish number and credit agreement number. In some banks the matter is easier – you can find ready-made application forms on their websites. It is worth knowing that such a claim expires in 3 years.
What are the consequences of resigning from credit insurance?
In general, buying a policy is not mandatory, although banks often give better conditions to lenders who have bought such insurance. Due to the resignation from insurance, the bank may increase the interest rate and the margin, as well as demand additional collateral for the loan. It can be different – at first, it is worth consulting a lawyer and recalculating whether it will be beneficial.
Does the fight for reimbursement pay off?
If we repaid the loan ahead of time – of course it is. Otherwise, it all depends on what insurance we have and what its terms are. It is worth knowing that the cost of loan insurance is up to 30% of the total liability.