Borrower’s Insurance: How will the new wear rate calculation change in 2023?


Borrower and wear rate insurance
Borrower’s Insurance: How will the new wear rate calculation change in 2023?

from 1Verse February to 1Verse July 2023 corrosion rates, serving as ceilings for the costs associated with a bank loan, they will be updated every month by the Bank of France, not quarterly. In addition to affecting the credit market, this temporary measure will also have an impact on the borrower’s insurance.

Wear Rate and Loan Insurance: What’s the Link?

The Bank of France defines the interest rate as: The maximum effective annual interest rate (APR) that can be applied to you when obtaining a loan As a reminder, the annual interest rate is an indicator that not only takes into account the so-called interest rate My name, my picture, my look, in name only from a bank loan.

The annual interest rate is calculated on the basis of All costs related to your loan. To be precise, the Bank of France is talking about ” Items that are a condition for obtaining credit or for obtaining it according to stated terms He cites a few examples, including the application fee, but also, above all, Insurance costs and compulsory guarantees “.

What does the new insurance abrasion rate calculation change?

So the APR is determined in part by the cost of securing your loan. At the same time, the cost of insurance will depend on your profile. Individuals who present a high risk to insurers (eg in the case of an extreme sport or a health problem) are particularly susceptible to the scissor effect between market-exercised rate increases and less frequent reassessments of wear rates.

Thanks to the monthly update of the wear rate, people who have risky profiles in the eyes of insurers will be able to more easily reconcile the higher insurance rate with other costs associated with the loan. Thus it will be possible for them Ease of obtaining a bank loan. To simplify your procedures, it is also advised to contact the broker to benefit from dedicated support from a professional.

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