Do you know the different factors that affect the cost of borrower insurance?  - Mag Mirror

Do you know the different factors that affect the cost of borrower insurance? – Mag Mirror

Also called credit insurance, borrower insurance is used to cover the borrower for the life of the loan. It can be chosen by the lender or by you. Its amount may vary depending on several elements on which the calculations to be made are based.

The life of the insured

The life of the insured is a lot on the price of insurance. In fact, borrower insurance for young people (under 35 years old) is less expensive than insurance for seniors. According to some studies, 25-year-old policyholders benefit from 0.25% of the borrowed capital, compared to 0.45% for 45-year-old policyholders (for 20-year loans). Thus the difference can go from double to triple. From the age of 55, the insurance rate often exceeds 1% of the amount borrowed, due to increased health risks.

Personal or professional situation

The personal or professional status of the insured can directly affect the total cost of the borrower’s insurance. For example, playing a risky sport or some occupation that is considered dangerous can increase the price of the latter. If this is your case, the insurance company will ask you for specific details. Depending on the risks, he will give you the appropriate response. As for stability, civil servants can benefit from job security.

medical condition

To correctly determine the cost of your insurance, the insurance company should ask you about your medical condition and any health problems you may have. This will cause a significant change in your prices. Thus, the responsible person will investigate your medical history, specific disability, long-term illness, and the fact that you are a smoker or not. In fact, borrower insurance for smokers (who have used tobacco, even in electronic form for the past two years) is more expensive than insurance for non-smokers.

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