Does life insurance need to make a loan?

Very often, when making a loan, especially mortgage, the bank proposes to insure the life and health of the borrower.

Many believe that life insurance and health is the trick of the Bank for profit. But, unfortunately, we are not given to know what it will be with us tomorrow. There are such unexpected situations as a disease, accidents automobile accidents and so on. In this situation, the borrower can be insolvent. Then insurance will become a family security tool financially. For example, the relatives will not be superimposed on loan.

At the legislative level, such a type of insurance is not mandatory. Banks are not entitled to force you or impose your life and health insurance for you, but in some cases the refusal to such an insurance may result in a potential borrower adverse consequences. Of course, it will be about the interest rate that will depend on your consent to receive an insurance policy or refusal. Therefore, banks often use the client’s position and still make life insurance and health obligatory for the borrower.



Registration of the insurance policy and health takes place in the Bank’s office, as a rule, on the day of the conclusion of the loan agreement. Also, if in the bank with an outstanding loan insurance of life and health seems less profitable than in another insurance, you have the right to buy a policy in the company in which you want, but the main thing is that it is accredited by the bank. Next, you need to pass the policy to the bank.

We want to emphasize the voluntary of the construction of life insurance and the health of the borrower upon receipt of the loan and the need to verify the current information from the lender on the consequences of the refusal of insurance for further conditions of credit.