"For today's mortgages, we note that all other customers are getting loan repayment insurance," says Martin Steiner, commercial director of BNP Paribas Cardif Insurance. It cooperates with Moneta Money Bank and Sberbank.
However, the share of insured customers may be lower for the entire market. "We do not have data on the market. Estimates speak for one-third, "says Martin Podávka, product director for Financial-Advisory Network Partners. Given that, last year, according to Hypoindex, 99,477 mortgage loans were provided by Fincentrum, 33,000 to nearly fifty thousand people interested in home loans obtained mortgage insurance.
However, the decline in interest on mortgages, which declined by about thirty percent, is negatively impacting the number of policies closed this year. "The lower number of mortgages provided is also logically reflected in fewer completed insurance contracts," says Michal Teubner of Komerční banka.
At the same time, banks motivate those interested in mortgage loans to provide life insurance or loan repayment. "Organizing life insurance is not a condition to provide a mortgage loan. Thanks to life insurance, however, the client can get a discount on the interest rate on mortgages, "adds Teubner.
Although financial advisers also recommend having a life insurance policy if a person hires a mortgage, they also point out that the banks offer has disadvantages. According to Podávka, it only covers grade 3 disability and does not relate to problems related to health problems before the ability to pay insurance begins. "If a client wants to refinance a loan, he will not carry it," adds Podávka.
But these are not the only pitfalls. "The ability to pay for insurance does not actually cover the customer but guarantees the bank in the case of the aforementioned risks," says Martin Novák, senior analyst at Broker Consulting. Often, according to financial advisors, it is often enough to pay an obligation to the bank, but it does not address other household responsibilities.
On the other hand, mortgage insurance is easier than offering life insurance and can be more profitable for some clients. "Amortization insurance protects financial liabilities in the event of loss of regular income due to unexpected events such as loss of employment, incapacity for work, care of family members, disability, hospitalization or even death," adds Steiner.