Comprehensive mortgage insurance. Mortgage home insurance: cost, is it necessary, documents

Welcome! Mortgage insurance - where is it cheaper and more profitable to get it? An interesting question that you must definitely deal with if you decide to take a mortgage. Further in the post, we will analyze mortgage insurance where it is cheaper. Which insurance is worth taking and which is not, as well as the basic conditions of insurance companies.

In the last post, we figured out that there are three main types of mortgage insurance:

Of these, only the first type is mandatory. The rest is not necessary to issue, but this will entail certain sanctions up to the refusal of a mortgage. Read our post “Mortgage Insurance” to learn more about all the nuances.

Before you go looking for the most favorable insurance rate, you need to contact the bank and take a list of accredited insurance companies from a specialist or on the bank's website. You can insure yourself on a mortgage only in these insurance companies approved in advance for working with a bank.

As a rule, banks issue the so-called comprehensive insurance. This is an insurance policy for all three types of the above insurance at once. Usually its cost does not exceed 1% of the loan amount, but in most cases it is even less from 0.2% to 0.5%.

The final rate depends on many factors:

1. Lender's bank - the lowest rates can be found in Otkritie Bank and Rosselkhozbank from 0.2%. This becomes possible through special agreements between the insurance company and the bank.
2. Gender of the borrower - for women, the rate is lower.
3. Client Weights – Borrowers who are overweight may receive a denial of mortgage life insurance or a higher rate.
4. The age of the borrower - the older the age, the higher the rate.
5. Fields of activity - risky professions receive an additional multiplier in the calculation.
6. History of the relationship between the borrower and the insurance company - personal discounts for cooperation, a bonus for switching from another insurance company, etc.

Advice! If you want to save money on an insurance policy, then make your spouse the main borrower, let your husband be. This will allow you to get the minimum rate.

From all of the above, it follows that the insurance rate is a rather individual thing, so there is no need to talk about exact numbers, but you can reliably determine at least their approximate order. Let's get acquainted with the conditions of the main insurance companies for mortgage lending.

Sberbank insurance

Sberbank, for example, requires mandatory insurance of collateral, and the property value limit is not more than 15 million rubles, you will be charged 0.25% of the loan amount, and every year this percentage will be charged on the balance of the total debt.

Life and health insurance will cost you 1%, but it is at your request, however, if you refuse, this percentage is added to the mortgage interest rate, or rather, it will be taken away with consent.

In practice, it looks like if the amount is approved at 14.9% per annum, then with life and health insurance, the rate will drop to 13.9%. Well, and a wide range of insured events that are insured, no one has canceled here either.

Also, if you take a mortgage from Sberbank, then this is the only bank that does not require comprehensive insurance, i.e. title is optional.

If you want to change the insurance company, then “you can do this painlessly with the full repayment of the loan, then you will be refunded the insurance premium for the remaining months. In another case, no one will return the rest of the insurance premium to you, except for the case when you refuse before the start of the insurance, then the premium is paid in full.

VTB Insurance

This is a comprehensive insurance that includes collateral, title and life and health insurance, i.e. one contract is concluded with you, for third-party banks for 1 year, for VTB for the entire term of the mortgage with annual renewal, which means that it needs to be renewed every year.

On average, insurance will cost you 1% of the amount under the loan agreement, annually 1% is also charged on the balance of the loan. When changing the insurance company, the conditions are the same as in Sberbank, i.е. either full repayment or non-refund of the premium.

Regarding VTB, we must make an important remark that in 2017 they did not pass accreditation, as they submitted documents late, therefore, at the moment, insurance for third-party banks is not provided. And, if you still want to insure here, you will need to clarify this information directly with the bank.

VTB Insurance has a discount for issuing a long-term policy (1.5 or 2 years, etc.).

VSK Insurance House

In this company there is no comprehensive insurance, only constructive and life. Life and health insurance will cost you about 0.55%, depending on the components indicated in the health questionnaire, over 4 million rubles. rubles - a medical declaration is required.

Structural elements are insured - approximately 0.43%, this percentage can be increased by such factors as a gasified house, as well as the first and last floors.

Regarding the change of companies, here, in addition to the fact that in case of cancellation of the contract, if the application from the Insured was received before the date of commencement of the insurance and no more than 5 days have passed from the date of conclusion of the insurance contract to the date of cancellation, you will be refunded the premium in full, there is another condition that in case of cancellation within 5 days after the commencement of the insurance and no more than 5 days have passed from the date of conclusion of the insurance contract to the date of cancellation, you will be paid a premium in proportion to the unexpired insurance period.

RESO

In RESO conditions for Sberbank differ from other banks, for Sberbank property insurance is approximately 0.18%, life and health within 1%. For VTB, Raiffizing Bank, Absolut Bank, etc. - comprehensive insurance, where life and health are also up to 1%, property - about 0.1% and title - about 0.25%.

In RESO, not only in case of early termination of the contract within 5 days after the conclusion, but before the start of the insurance, the premium is paid in full. In the event of early termination at your request, the company shall refund the insurance premiums for the unexpired term of the contract, minus the costs incurred, unless otherwise specified in the insurance contract.

It should also be noted that RESO is currently running the Profitable Mortgage promotion, a 40% discount for the first year for mortgages and for those who decide to change companies.

Alliance (Rosno)

In Alliance, life and health insurance will be 0.87% of the sum insured; property insurance - 0.16% and title insurance - from 0.18%. They do not insure for Sberbank, because there is no accreditation. Now the company is running a mortgage insurance campaign, which means that when you take out a mortgage insurance policy, you can insure additional risks at preferential prices:

• interior decoration of the property (wall, floor, ceiling);
• insurance of civil liability to third parties during the operation of residential premises;
• increase in the sum insured for life and health;
• increase in the sum insured on property to the market value of the property.

It should be noted that due to the closure of offices in the regions, servicing is carried out by the Central Moscow office.

Rosgosstrakh

Life and health insurance for Sberbank - 0.6% (male) and 0.3% (female); property - from 0.2%.

For VTB and other banks - life - 0.56 (man), 0.28% (woman), respectively; constructive - 0.17%; well, and title insurance - 0.15%. By agreement with the Central Office, discounts are possible, but the amount is determined individually in each case.

The sum insured decreases in proportion to the decrease in the loan amount. Early termination of the insurance contract on your initiative is also provided here only in case of full early repayment of the loan, in this case you are paid a part of the premium paid for the remaining term, minus 65% of the paid insurance premium. For other reasons, early termination on your initiative is possible, provided that the insurance premium is non-refundable.

Ingosstrakh

Here you can insure everything individually or choose a comprehensive mortgage insurance, which, as you already know, includes property, life and title insurance. They do not provide approximate rates, you can only calculate the cost of insurance on your terms. Let's look at the example of a 38-year-old man, without bad habits, healthy, working in the prosecutor's office and a woman of the same age, but an estimate engineer, the amount of their mortgage is 8,000,000 rubles, secondary housing on the 5th floor, owned for more than 3 years . Insurance programs for Sberbank and other banks also differ here, so let's move on to the numbers:

For Sberbank:

life insurance - 35,518 rubles (man) and 25,248 (woman);

Collateral property - 11,200 rubles (for each),

In total, we see that for a man - 46,718, and for a woman - 36,448. Contracts are drawn up for 1 year.

For VTB and other banks:

life insurance - 44,418 (for a man) and 18,176 (for a woman);

Constructive - 12,000 rubles (both for one and for the other);

Title - 16,000 rubles (for each).

As a result, you see that for a man in this case, comprehensive insurance will cost 72,418 rubles, and for a woman 46,176 rubles. For VTB there is an opportunity to conclude an agreement for the entire term of the loan with an annual extension.

You can terminate the contract ahead of schedule at your request on the same terms as most previous organizations, within 5 days after signing the contract you will be refunded the insurance premium in full, more, the premium is not refundable. Exceptions are, for example, the fact that you have not been issued a mortgage.

If you decide to change the insurance company to Ingosstrakh, then you will be provided with preferential terms in the form of a discount from 5 to 15%, the exact amount of the discount is decided by the management: up to 3,000,000 rubles, the decision is made by the regional branch, above - the central Moscow office.

Now there is such a promotion: if you have a mortgage insurance contract concluded with this company, then for voluntary insurance (engineering networks, finishing, property, etc.) - a 20% discount.

Alpha Insurance

In Alfa-insurance, you can also choose comprehensive mortgage insurance, the term of which will be equal to the term of the loan and will decrease every year as the debt is repaid. The contract is terminated ahead of schedule identically to the conditions of VSK Insurance House. When changing the insurance company, here you get a simplified procedure for drawing up a contract and more favorable conditions. The contract is for 1 year.

As in all companies, there are different programs for Sberbank and other banks. But today the organization in question does not have accreditation for life and health insurance for Sberbank, so you can only insure property, it will cost 0.18% of the mortgage amount.

For VTB and other banks, you can insure for the entire duration of the mortgage, to see the cost of insurance, we will again refer to our example (male and female 38 years old and 8,000,000 rubles):

Life - 46,900 (man) and 30,452 rubles (woman);

Constructive - 9,200 rubles;

Title - 12,000 rubles.

Now you can see that the exact cost of mortgage insurance depends on many factors, so all the amounts given to you in the example are approximate.

SOGAZ

Insurance in Sogaz is one of the most affordable:

1. Structural - 0.1% if you additionally take out insurance for decoration, furniture, plumbing and civil liability for a minimum of 1150 rubles.
2. Life and health - 0.17%
3. Title - 0.08%.
4. Credit default insurance - 1.17%

In case of early refusal of the client from insurance (early repayment of the mortgage), a part of the fee for the unexpired policy is returned, reduced by the share of the load in the structure of the tariff rate. For other reasons, there is no return.

comparison table

Analyzing the above, we can bring everything into a comparative table for all the insurance companies we consider using the example of the same man and woman with the initial data taken by us at the beginning of the post.

Bank	Property (constructive)	Life and health	Title
Sberbank	0,25	1	No
VTB	0,33	0,33	0,33
VSK	0,43	0,55	No
Alliance	0,16	0,66	0,18
RESO	0,1	0,26	0,25
Rosgosstrakh	0,17	0,28	0,15
Ingosstrakh	0,14	0,23	0,2
Alpha Insurance	0,15	0,38	0,15
Sogaz	0,1	0,17	0,08

Online calculator

To make a calculation, you must fill in the data on the calculator. It will allow you to calculate the cost of the policy with the risks you need and issue the policy online.

Outcome

To find out where mortgage insurance is cheaper, you need to take a few steps:

1. Get a list of insurance in the bank or on our website.
2. Analyze the list to find insurance companies where you have preferences.
3. Analyze the list according to our table.
4. Find some of the best deals.
5. Make a calculation on our online calculator.
6. Call your insurance company and find out the final rate for you.

Summing up our post, we see that insurance significantly reduces the interest rate on a mortgage, and refusal to insure collateral is fraught with a bank refusal in a mortgage, which means it is better to insure. And if you approach this issue with all responsibility, with the understanding that a mortgage is far from a short-term loan and anything can happen in our life, you, of course, will eliminate possible risks that may affect your obligations in front of the Bank. Although, it's up to you to decide and any of your decisions will be right for you!

And we are waiting for your questions in the comments, which we will be happy to answer.

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What types of insurance are available when applying for a mortgage loan

In addition to the most common types of mortgage insurance listed, loss of ownership insurance may also be required, and less often borrower liability insurance.

Property insurance

Home insurance (constructive elements) is a mandatory type of insurance for mortgages, such insurance is relatively inexpensive - from 0.09% to 0.16% if an ordinary apartment is purchased. It will cost more (1-2%) if a non-standard property is purchased - a house or a townhouse. The amount of the insurance premium can be affected by the presence of wooden floors, the age of the building, and the percentage of wear.

Compulsory insurance of the collateral object acts as a guarantee that in case of unforeseen circumstances, such as damage or destruction of real estate, the mortgage will be repaid at the expense of payment from the insurer.

Banks require insurance for an amount not less than the loan amount (some for the loan amount + 10%, so that the insurance payment can also cover interest), this condition is prescribed in the loan agreement.

To reduce their own risks, the borrower can insure housing for an estimated value that is greater than the loan balance. In this case, when the housing is destroyed, the insurance payment will allow not only to close the loan, but also to get the difference between the balance of the principal debt and the cost of the apartment. The first beneficiary will be the bank, but only in the amount of the client's obligations, everything above will be received by the client himself. It is impossible to insure housing for a value exceeding the appraised value.

Insurance protects against damage to structural elements as a result of fire, flooding, vandalism, construction defects. If the client hid information from the insurance that affects the likelihood of an insured event (for example, there is an act on violation of building codes, or construction work is carried out next to the house in which the insured apartment is located), then payment may be denied.

There are cases when the insurer refuses to pay, referring precisely to such facts. Such a refusal can be challenged in court by providing supporting documents. In the application-questionnaire (which is a mandatory annex to the insurance contract) for insurance, all housing parameters that are necessary for risk assessment are specified in detail.

Life insurance

Life and disability insurance is not a mandatory type of insurance, it can be waived. Banks do not have the right to impose additional insurance, but they still succeed. The client is given a choice - to take out life insurance or the mortgage rate will increase significantly.

Borrower life insurance is kind of an optional type of insurance, but banks are able to impose it

It turns out a choice without a choice - an overpayment on a loan with a higher rate (some banks threaten to increase up to 5%, although usually no more than 3%) is much more than the cost of insurance. In rare cases, when the client is older and life insurance will be very expensive, it makes sense to refuse life insurance in favor of increasing the rate, and even then only if the mortgage term is short. But here, too, credit institutions protect their interests and, without prescribing this requirement in the loan agreement, since it violates the law, they set the condition that the loan will be issued only if there is an insurance policy.

In mortgage agreements until 2008, the requirement to insure life and disability is prescribed as a separate clause; if desired, you can return the money for imposed insurance through the court if there is time for litigation and the amount is significant.

The cost of life insurance depends on the age, profession, body mass index of the client. And also from the bank, since insurance companies pay credit institutions from which the client comes, a commission, which can reach 45-60% of the insurance premium.

So, for example, insurance for VTB24 will be one and a half times more expensive than for Sberbank, in the same insurance company, all other things being equal, since the commission for VTB24 is 45% (through intermediaries who claim that they will provide “the best favorable "conditions, 60%), and Sberbank does not take a commission.

When insuring life, it is important to make a calculation in several insurance companies at once, since the rates vary significantly. In one, the insurance rate will be 1% for clients of any age (it will be profitable to insure older clients, and not profitable for young ones), and in the other, for clients 20 years old - 0.16%, and for clients aged 50 - 1.8%, all individually.

So, it’s not profitable to refuse life insurance, but you can still save a lot on insurance if you calculate the cost in several insurance companies (the first one recommended by the bank will most likely have the maximum cost due to the maximum commission) and choose the most suitable one according to price.

It is worth considering the schedule of insurance payments immediately for the entire period, if possible, as there are cases when the insurer lures the client with a low rate for the first year. Although in any case, it will be possible to change the insurance company in the future if there is a better offer.

Title insurance

Not all banks require property loss insurance. Individual credit institutions will insist on this type of insurance only when the presence of risks is revealed when examining documents for an apartment. Of those banks that still require title insurance, 2 groups can be distinguished:

1. Requiring insurance for 3 years (limitation period);
2. Requiring insurance for the entire term of the mortgage.

The long term insurance for the loss of property rights is due to the fact that 3 years are given to contest the transaction not from the moment of the real estate transaction itself, but from the moment when potential owners find out that their rights have been violated, that the transaction has already been completed. Thus, even ten years after the purchase of the client's apartment, a lawsuit on this issue can drag on.

Title insurance for mortgages is mandatory for some banks, not for others

A credit institution is only interested in insurance for the amount of the loan, but the client has the right to insure for the full cost of housing. To do this, in addition to the insurance contract, the beneficiary of which will be the bank, a voluntary title insurance contract is concluded (for the difference between the assessment amount and the loan amount), the beneficiary of which will be the borrower.

Unlike property insurance, a contract under which it is possible to conclude a rhinestone for an estimated value (even as part of a comprehensive mortgage insurance contract), voluntary title insurance is drawn up in a separate contract, and different beneficiaries will appear in two contracts, in one bank, in another borrower. This is due to the intricacies of litigation in insured events for this type of risk.

If you apply for voluntary insurance outside the mortgage, then the insurance rate will be higher, but if you conclude two contracts at the same time, then in most insurance companies the rate will be the same for both due to the discount.

Borrower liability insurance

Borrower liability insurance for a home loan may be required by the bank under certain conditions for granting a mortgage, for example, with a minimum down payment and a reduced rate. The last of the listed types of insurance is relevant in the context of a possible decrease in real estate prices.

A common erroneous opinion is that if the borrower's liability is insured (and this is a very expensive insurance) in case of default on the loan, the insurance company will pay for the mortgage. This is not so, the insurer will only reimburse the bank for the difference between the balance of the mortgage debt and the value of the property sold, if this value is not enough to pay off the debt.

How to reduce mortgage insurance costs?

Banks recommend life, title and property insurance and attribute this to what they think about the future of the client. For example, if something happens to the borrower, then the apartment goes to the heirs along with the loan obligations. If such methods of persuasion do not work on the client, then the credit institution will offer to abandon optional types of insurance, but will raise the mortgage rate. In this case, the overpayment, taking into account the increased rate, will be significantly more than the cost of insurance.

Is it really possible to save on insurance when applying for a mortgage loan?

The client can choose an insurance company on his own, but it is necessary to choose from a list of accredited ones. Accreditation means that the bank has checked the insurer and that it is completely reliable. You can save on comprehensive mortgage insurance if you apply to the insurance in which the borrower is already a client, for example, for compulsory health insurance, since there is a high probability of receiving a discount.

The size of the “thirteenth payment” decreases in proportion to the decrease in the principal debt, therefore: the faster you manage to pay off the mortgage, the more you can save on insurance.

Not everyone knows that the rate for property insurance and title insurance is the same for the entire term of the loan, and life insurance rates increase in proportion to the age of the borrower.

At the same time, in some periods there are sharp jumps in tariffs (40-50 years), this can be seen from the planned schedule of payments for insurance (which, unfortunately, not all insurance companies provide to customers). It makes no sense to advise you to pay off your mortgage before the age when insurance becomes more expensive, but at least consider the fact that, despite reducing debt, insurance payments may increase in the future, it is worth it.

It is worthy of special attention to consider the case when the client is considered risky for the insurance company due to his profession: driver, pilot, welder. In such cases, a correction factor is applied to the insurance rate, and insurance becomes more expensive by 20-50%, taking into account the increase in the base rate with age, the amount can be impressive. If such a client changes his profession to an office one, then it is worth notifying the insurance company about this and writing an application for the recalculation of tariffs. This is another way to reduce mortgage insurance costs.

Quite labor-intensive (you will need to re-submit all documents), but still a way to save money that has the right to exist, is the transition to a competing insurance company. Many insurers have special conditions for customers who have a valid policy (mortgage insurance contracts in most cases multi-year) of a competing insurance company. This allows you to get a significant discount and insure on more favorable terms.

So, it is possible to refuse insurance (in addition to real estate insurance), but almost always the loan rate increases and savings in insurance result in an additional overpayment on the mortgage.

In order to reduce costs, it is better to carefully study the offers of insurance companies and choose the best option. You can get a discount either by contacting the insurer, whose client the borrower is already, or by switching to another insurance company, already having a valid mortgage insurance policy.

When applying for a mortgage, it is common practice for any bank to require the signing of a comprehensive mortgage insurance agreement, which traditionally combines three different types of insurance - borrower's disability and life insurance, collateral insurance, and the risk of loss of ownership (title insurance). We will try to answer common questions that arise when applying for mortgage insurance.

When choosing an insurance organization, first of all, check out the list of companies accredited by the bank. Accredited firms are partners of a credit institution who have passed the test, whose performance indicators, including financial, and the conditions for providing insurance services meet the requirements of this bank.

In theory, it is possible to take out a policy from a non-accredited insurer, but this requires that the company has successfully passed the test for compliance with the conditions. It is necessary to receive quite a lot of documents from the insurer (financial statements, constituent documents, etc.), which not every organization is ready to submit. The procedure for reviewing documents by bankers takes up to two months. Even if with the help of representatives of the insurer he can collect the entire set of documents, he is unlikely to have two months left before entering the procedure for obtaining a loan. But even if the time is unlimited, there are no guarantees that the insurer will meet the bank's requirements.

If bankers demand to issue a policy from a particular insurer, claiming that they accept documents from only one company, this is a violation of the law "On Protection of Competition" and government decree No. 386. can complain to the FAS. But practice shows that in this case, there is a high probability that the lender will refuse to provide a loan "without explanation."

How much to take the insurance amount

At the initial registration of a housing loan, the sum insured is set in accordance with the conditions specified in the loan agreement. It can be set both in the amount of the loan and in the amount of the loan increased by a fixed percentage (say, by 10%). Such an amount of insurance is set with the aim that in the event of an insured event, the amount of compensation unequivocally covers before the financial organization, taking into account possible penalties for late payments on the loan.

At the same time, the client will not return the funds already invested in residential real estate in the form of a down payment and mortgage payments. Therefore, you should think about property insurance against damage and loss and against loss of ownership of the property for the entire market value.

Most insurers offer to issue an increase in the amount of insurance with a separate policy for a year with subsequent prolongation. This is done to enable the borrower to appoint not the lender, but the insured as the beneficiary, include additional risks in the contract (civil liability, interior decoration), make changes to the contract and issue an installment payment without the consent of the lender (under the terms of loan agreements of almost all banks, changes in Mortgage insurance policy can only be paid with the written permission of the bankers).

How long do you need to be insured

The term of insurance is set by the bank, it is prescribed in the terms of the loan agreement (mortgage agreement). The policy can be one-year with annual renewal and multi-year. One way or another, the client must make continuous insurance for the entire duration of the mortgage agreement. If the continuity of insurance is broken, individual lenders meet the borrower halfway, providing (usually for a month) for the renewal of insurance. If there is no grace period, and the client did not pay on time or decided to refuse it altogether, bankers can fine such a client: starting with an increase in the loan rate and ending with a requirement to repay the debt ahead of schedule, which depends on the conditions specified in the contract.

Based on the Federal Law No. 102 “On Mortgage”, insurance of collateral against the risks of damage and loss is mandatory and is carried out in accordance with the terms of the mortgage agreement, which speak of the continuity of insurance. In accordance with Article 35 of this law, in case of violation of the obligation to insure the mortgaged real estate, the pledgee (bank) may demand early fulfillment of obligations under the loan.

If we talk about the requirements for title and life insurance, these types of insurance are not mandatory. However, the terms of mortgage agreements of most financial institutions provide for an increase in interest under the agreement in case of non-fulfillment of conditions for voluntary insurance. If the client refuses title and / or life insurance, the bank has the right to raise the loan rate to the level specified in the agreement.

Based on Article 181 of the Civil Code of the Russian Federation, the limitation period for claims to recognize a transaction as void is 3 years. If a claim is brought by a person who is not a party to the transaction, the limitation period may not exceed 10 years from the start of the transaction.

It turns out that within 10 years from the purchase of an apartment, the former owner, whose rights were violated by some transactions that preceded the last one, as a result of which the client received the property, can appear and file a lawsuit to declare the transactions invalid. Accordingly, the risk of loss of ownership of the client lasts up to 10 years.

However, many banks are not opposed to taking out title insurance only for the first 3 years of owning an apartment. But at the same time, the borrower must know that for the remaining years the risk of losing the right to an apartment falls on him.

How to find out the cost of mortgage insurance

Mortgage insurance is a complex product consisting of several types of insurance. Many factors affect the final rate. It is impossible to roughly calculate the cost of a policy based on Internet sources and the experience of acquaintances. Only an employee of the insurer will be able to announce the price of insurance for a specific borrower and object of insurance.

And although many insurance companies offer citizens the calculation and execution of the contract in a day, in practice this process takes more time. Studying the offers of insurers is better not to postpone until the last moment, but it is worth starting as soon as it becomes known about the need to insure. First of all, we advise you to check with the insurers the terms of the contract: carry out a preliminary calculation of the price, clarify the list of necessary documents and procedures (medical examination, inspection of the apartment, etc.), the procedure for signing and paying for the insurance policy, the possibility of delivering the policy for the transaction to the bank, request from the insurer employee insurance application. After a preliminary determination of the price, it is not recommended to opt for the cheapest offer, since after the presentation of the securities, the price of the policy may increase significantly.

To receive the final offer from the company, you must fill out an application and submit the collected documents. It is better to choose several offers at the best price and other parameters, then you need to fill out an application and send it along with a set of papers to the employees of the selected insurers. The final response from the company comes on average within a day. If the bank requires a multi-year policy, ask the company for an insurance payment schedule for the entire period in order to understand the rates for subsequent periods. Usually the borrower's life insurance rate increases annually, the title insurance and property rate should not change. Some firms may set low tariffs for the first year, but increase them sharply from the second. They do this to lure the client, hoping that when paying for the next period, the client does not use the right to change the insurer, since this procedure may be associated with certain difficulties. If you save now, you can spend much more in the future.

Since mortgage insurance is a long-term contract, that is, this service is necessary until the mortgage is repaid, there are many more problems and nuances that you may encounter during the life of the policy: policy renewal, changes due to restructuring or refinancing, the occurrence of an insured event, etc. .

Any borrower should know that when applying for a mortgage, he does not have to insure his life and health.

But still, when applying for insurance, he will be provided with more favorable loan conditions, as well as a reduction in the interest rate. Therefore, whether mortgage loan insurance is needed is up to each individual to decide. As statistics show, people are increasingly resorting to the services of banks, especially mortgages. As shown by the results of last year, the number of mortgage loans has doubled.

Why do Russians need a mortgage?

First of all, borrowers liked the fact that mortgage rates fell, which are still holding today. But this affected only those who, together with the contract, also carry out insurance of mortgage lending. If the client refuses this, then the rate will be increased accordingly. Let's talk about all the details and pitfalls of this process and draw conclusions.

Should I agree to the terms of the bank?

Of course, the client may refuse to conclude a mortgage insurance contract, because these are additional costs. It is worth knowing that such a strongly imposed service is not at all obligatory and no bank has the right to force a client to issue it, much less refuse to provide a mortgage. As practice shows, in case of refusal from comprehensive insurance, the interest rate behind the scenes increases by 0.4-1.3% per annum.

In fact, banks receive a limited reduction in their own risks, which leads to an increase in interest on the loan. Although it seems that this is an insignificant fraction of a percentage, it turns out to be tens of thousands of rubles. Therefore, in most cases it is better to pay and take out mortgage insurance (what it is - we will consider in detail later). This action will be much more profitable than higher rates.

Mortgage life and health insurance

By agreeing to get a loan on the terms of the bank, you can really protect and save your family from many problems. If grief happens in the family, the borrower dies or becomes disabled, then no one can evict the heirs, but only on the condition that the borrower has taken out insurance. But it is up to you to make the final decision as to whether to conclude a mortgage insurance contract.

Payment of insurance is made once a year throughout the entire term of the loan. If we talk about title insurance, then it is only needed for three years. That is, until the statute of limitations expires, which is allotted for challenging real estate transactions. You need to insure the title not only for secondary, but also for primary housing. Again, it all depends on the borrower.

If you don't want insurance, pay!

Many people think that VTB insurance (mortgage insurance) is a mandatory service, since banks used to have the right to force customers to apply for this service. But now everything has changed. A couple of years ago, a resolution was adopted that regulates all options for agreements between credit and insurance companies.

Since then, compulsory insurance when obtaining a mortgage loan is theoretically needed only for collateral. Everything else is subject to the customer's choice. Therefore, almost all borrowers began to refuse insurance in order to save money. Banks had a lot of losses and to cover them they began to issue loans at higher interest rates. This example was used by almost all credit organizations in the country, and now it has become difficult to find a profitable mortgage without insurance. On average, the rate increases by 3-4%.

Comprehensive insurance

Comprehensive mortgage insurance - what is it? This is a type of insurance that includes all types at once. This is life insurance, and health, and collateral, as well as several other types. This product is much cheaper. In addition, the interest rate will be fixed throughout the life of the loan. As for the payments themselves, they will decrease, as they depend on the amount of debt. This is a distinctive feature of comprehensive insurance.

Do you need insurance at all?

According to the law, VTB insurance (mortgage insurance) is not mandatory. This only applies to collateral. But after all, banks should reduce their risks to a minimum, because mortgages are issued for a very long period with a small rate. Therefore, it is beneficial for credit organizations that borrowers insure their lives, health and apartments.

As mentioned above, it makes sense to insure the title of property for only three years. This is due to the statute of limitations for claims to challenge transactions with apartments. Banks somehow forget that there are cases of double sales, intentional or erroneous. As for the answer about the need for life insurance, it is hidden in the statistics, since there are almost no refusals. On the one hand, for those who have not taken out insurance, banks raise interest rates, but on the other hand, borrowers are well aware that anything in life can go through, and an apartment is purchased so that children can live in it. So if we take into account all the risks, then, in fact, comprehensive mortgage insurance is beneficial for both the client and the bank.

A question of price

Probably, it is not worth talking about each type of insurance separately, since each insurance company offers complex products, which usually include three different insurances that the bank needs. Such a package costs from 0.5 to one and a half percent of the total cost of the loan. If each risk is insured separately, it will be much more expensive.

Mortgage insurance - what is it? This is a very individual thing, it can be different, just as clients are different. If a mortgage is issued to a young man who works in an office and collects stamps or butterflies, then for him the insurance will cost less than for a fifty-year-old metallurgist moonlighting as a stuntman. It probably doesn't even need to be said why.

The price of insurance also depends on the property being purchased, as it acts as collateral. For example, if a young man from the first case decided to buy a house in an earthquake-prone area, then insurance will, of course, cost more.

What is the size of the payment?

With a housing cost of 3 million rubles (a million of own funds, and 2, respectively, borrowed) at a rate of 12% per annum, the loan payment will be 22 thousand rubles. If we also add insurance here, for example, in the amount of one percent of the cost of the loan, then it turns out that in the first year you will need to overpay 20 thousand rubles, which is almost equal in size to a monthly payment. Over time, as the principal debt decreases, so will the cost of insurance. On the other hand, every year the purchased apartment also ages, and therefore it is extremely difficult to predict the amount of insurance.

What to do in the event of an insured event?

When an insured event occurs, it is necessary to notify the insurance company and the bank to start the insurance mechanism. The thing is that the bank will receive the payment, and therefore the issue will be resolved between the bank and the insurance company, although, of course, it is worth monitoring the situation for the client.

What should I do if there is not enough money to pay off the debt upon the occurrence of an insured event?

Mortgage insurance (Sberbank or any other bank) assumes that such a case simply does not happen, because before paying off the bank, the insurance company specifies the amount of the debt. And the bank, for its part, will not allow any part of the debt not to be covered by the policy.

Can they refuse to pay?

Mortgage insurance - what is it, you already understood, but can an insurance company refuse to pay?

In this case, if you think that you are right, contact the arbitration court. The main thing here is not to forget that the bank will be your ally. Only now it will be useless to sue if during the conclusion of the insurance contract a fact was hidden that for some reason led to the occurrence of an insured event. In such a situation, the court will be on the side of the insurer - and the apartment will have to be sold.

Can the insurance contract be terminated?

Of course, you can, but then the bank will require you to pay the balance of the debt, which is provided for under the contract, and this is not such a small amount. So if you want to change the insurance company, then coordinate it with the bank and get their approval. As a rule, credit institutions try to work with large companies for which large payments are not a terrible event. So you don't have to worry that you won't get paid.

Finally, I would like to give one piece of advice: it is best to find an insurance company yourself that will sell insurance on more favorable terms, because when applying for such a product at a bank, there is a very high probability that you will overpay an amount that is quite tangible for the budget.

Conclusion

Before you take out a mortgage, be sure to think about insurance. Do you need it? Or would you like a higher interest rate? What risks may arise during the loan repayment term? Also, try to figure out how much insurance and higher interest rates will cost you. What will be more profitable in the end? Maybe in this case, insurance is not scary at all? Think very well and only after you solve all these issues, it will be possible to finally figure out whether it is worth taking out insurance.

Comprehensive mortgage insurance can help the borrower fulfill his loan obligations in the event of unforeseen life circumstances such as disability, death, destruction of property, etc. This article discusses the key features of comprehensive mortgage insurance, analyzes the pros and cons that this insurance protects against.

Features of mortgage insurance programs

Due to the fact that the mortgage risk is of a long-term nature, this determines the following features of comprehensive insurance programs:

• mortgage property insurance is mandatory;
• the maximum cost of the policy usually varies between 1-1.5% of the loan amount;
• insurance is subject to the protection of the life and health of the insured, as well as liability for non-repayment of the debt;
• title protection (property rights to real estate) is also subject to insurance.

However, it must be remembered that comprehensive mortgage insurance programs do not cover all risks. Thus, the program does not apply to intentional damage to the property or physical condition of the insured.

In some situations, clients can harm themselves, and even death through their own fault and negligence. For example, in one of the credit companies in the city of St. Petersburg, an out-of-the-ordinary case occurred: the borrower issued a mortgage, purchased a three-room apartment and wanted to celebrate this event. He drank a large amount of alcohol, climbed onto the roof of a 12-story building, began to walk along the very edge, could not resist and fell down. As a result, he died.

In this situation, the insurance company refused to pay the debt, which amounted to one hundred percent of the loan amount, because the insured made a gross violation of the insurance contract.

In general, comprehensive mortgage insurance programs include:

• real estate insurance - this category includes insurance of all kinds of accidents, emergencies and criminal acts by third parties that can damage the insured property or destroy it. However, each circumstance is considered specifically in the terms of the contract, and the UK may not assume payment for certain circumstances;
• life, health, ability to work - it is impossible to predict your income for the next few years with 100% certainty, because anything can happen to a person. No one is insured against accidents, loss of regular income or disability - in this case, insurance companies offer a special option in case of disability;
• title insurance - is an insurance program in case of transfer of real estate into the possession of third parties for one or another legal reason.

Risks covered by the program

In general, the comprehensive insurance program allows you to protect property from the following risks:

• loss or significant damage to property from an accident, natural disaster or illegal action / inaction of unauthorized persons that caused the loss;
• death or disability of the insured person;
• the risk of deprivation or restriction of ownership of real estate.

Advantages of drawing up an insurance contract

The conclusion of a comprehensive mortgage insurance contract has a number of advantages for both the borrower and the bank that issued the mortgage loan. In particular, for the borrower who is the insured, the benefits are as follows:

• prompt decision-making regarding the execution of the contract;
• reduced interest rate on the loan;
• minimum initial payment;
• loyalty of the bank to the provision of loans;
• guaranteed and timely financial compensation in the event of an insured event.

In addition, the conclusion of an insurance contract guarantees the borrower confidence in the future and support from the insurance company in case of force majeure situations.

For the lending bank, the benefits are as follows:

• obtaining guarantees from the UK in the timely return of funds;
• minimization of risks associated with non-payment of a mortgage loan by a borrower;
• minimization of risks of loss of property rights (title).

How to conclude an agreement

Before signing the contract, it is necessary to decide on the choice of the insurer company. At this stage, it is better to give preference to large insurers that work closely with large banks. These include the following companies:

• "RESO-Guarantee";
• "VSK Insurance";
• "Ingosstrakh";
• "Renaissance Insurance";
• VTB Insurance.

After choosing a company, it is necessary to determine the insurance options that are most appropriate to include in the program, the sum insured and the period of insurance for which the contract will be drawn up - usually it is drawn up for the entire period of making payments on the loan.

To conclude a contract, the following package of documents is required from the insured:

• a copy of the passport of the borrower and the guarantor;
• statement;
• certificate of state registration of the right to property (copy);
• loan agreement (copy);
• certificate from BTI;
• floor plan of the building (copy);
• extract from the house book;
• act of appraisal with the market value of housing;
• all contracts related to the acquired property;
• copies of passports of sellers of property (if they are individuals);
• for a legal entity: constituent documents, certificate of registration, registration in the Unified State Register of Legal Entities, tax registration (if the property is acquired from a legal entity).

If necessary, the insurance company may request additional documents.

Cost of insurance

The cost of the comprehensive mortgage insurance program from company to company is approximately the same and varies within 1-1.5% of the loan amount. Here are the approximate rates offered by various companies:

• "Renaissance" - the cost is about 1% of the mortgage amount;
• "VTB Insurance" - from 1 to 1.5% of the loan amount;
• "RESO-Garantia" - the cost varies between 0.6-1.5%.

Below is a typical example of calculating the cost of insurance for a typical borrower.

For example, a borrower has decided to insure an apartment under the following conditions:

• insurance rate - 0.404%;
• start date of the contract - 01/01/2017;
• the amount under the mortgage insurance agreement - 1,000,000 rubles;
• term - 36 months;
• interest rate - 15% per annum, annuity payment;
• the date of the first payment is 01.02.17.

As a result, the amount of payment for the entire period of insurance will have the following values.