Do I need to double my life and multi-risk insurance policies when transferring my mortgage credit?

Need to clarify issues related to credits and insurance? The agents of Poupança no Minuto offer free credit intermediation and insurance mediation services. Contact us now or understand better what happens to insurance when transferring the mortgage loan afterward.

Mortgage credit: Must have associated life insurance and multi-risk insurance.

When hiring a home loan, banks require you to hire two insurances: a life insurance and a multi-risk insurance. It is a mandatory step for the financing to be approved, so that the bank protects itself in case an unexpected situation arises.

So, life insurance protects the bank in case the loan holder suffers an illness or accident that prevents them from earning income and repaying the loan installments. At the same time, comprehensive insurance protects the property in case of any mishap. Depending on the coverage, it may also cover the contents of the property.

You can look for the most suitable insurance company.

As a rule, banks ask you to contract insurance with their associated insurer, but know that you are not obligated to do so. You can look for the insurer that makes the most sense for you and offers you the best proposal in terms of cost-benefit. In this case, the bank may increase the credit spread as a result. However, often it is worth it when you calculate how much you save by having insurance with a company outside the bank.

But considering the following situation: you already have the housing credit contracted and, at the time you went through the process, you hired the insurances at the associated insurer. And now you want to transfer the housing credit. The question arises: What should be done with the insurances? Is it possible to cancel the policy in advance in these cases? Let's see next.

I want to transfer the housing loan, what do I do with the insurance?

If, due to lack of knowledge or considering it advantageous, when you took out your home loan, you opted for the bank's associated insurance company to contract the required insurance (life and multi-risk), there may be some questions when you want to transfer the home loan. Once the insurance was contracted with the bank's partner insurance company, what happens to the insurance when transferring the loan?

What often happens is that when transferring credit, customers forget about insurance and take out new policies with the bank's insurer to which they transferred, at the bank's suggestion (for better financing conditions). This leaves other insurances active and results in duplicate insurance, unnecessarily. 

How to prevent duplicate insurance policies?

So, what should be done to prevent this situation? Normally, these insurances can only be canceled in two cases: by not renewing the policy, which implies waiting until the next renewal date, or in the sale of the property.  

In this case, since the property is not sold but the debt is settled at the first bank, you must be aware that it is a matter that will have to be dealt with directly.

Therefore, to prevent the contracting of duplicate insurances, you can: Suggest to the new bank to keep the current insurances you have, if you are satisfied. Or, if you consider it worth it, proceed with transferring the insurances to the new insurer. It is true, just like you transfer the mortgage, you can also change the insurances to a new entity.

Although it does not happen automatically, meaning that when transferring the credit it does not transfer the insurances, it is possible to request the transfer at the current insurance company.

To ensure no steps are missed, you can turn to a credit intermediary/insurance mediator like Poupança no Minuto to assist you in the transfer processes, both for housing credit and insurance.

Ensure you achieve the greatest savings possible on your expenses and monthly payments, with the help of a free and personalized service. Contact Poupança no Minuto, save yourself from bureaucracies, challenges, and save on your budget!