Borrower insurance
Excess, waiting period, waiting time: when mortgage insurance actually starts paying out
Waiting period, excess, waiting time: three often confused timeframes. What each one delays, and the line in the policy document that dates the first payment.
Mortgage insurance starts paying at the end of the excess, a period counted from the event during which the cost remains the responsibility of the insured, provided that the event occurred after the waiting period, which is counted from the date of joining. The waiting time is a commercial term for either of these. No legislation sets these durations: they are to be read in the policy document, guarantee by guarantee.
By Sandy MASCART, mandataire d'intermédiaire en opérations de banque et en services de paiement ORIAS 26000541 sous le mandat de CDV PATRIMOINE & ASSURANCE (ORIAS 14005573)
Key points
- The waiting period prevents the guarantee from being triggered for a period counted from the date of joining: an event occurring during this time is never covered.
- The excess delays the payment for an event already covered: it is counted from the event, not from the declaration to the insurer.
- No legislation sets the duration of these timeframes: they are contractual clauses, to be read in the policy document, never a general market rule.
- Throughout the excess, mortgage instalments continue while income has already decreased: the precautionary savings must be calculated over this period.
- The waiting time is not a legal concept: its contractual definition states whether it refers to a waiting period or an excess.
The waiting period determines whether a claim is covered; the deductible determines when the insurance begins to pay. Place the three counters on a timeline: you will know on which date your policy would pay. A key point of the borrower insurance file, with the guarantees, lump-sum or indemnity and “your profession” or “any profession”.
What is the difference between the waiting period and the deductible?
The waiting period runs from the date of adherence: an event occurring during this period is not covered at all. The deductible runs from the event: it is covered, but the payment awaits the end of the delay.
These are the definitions of the model sheet annexed to Article R. 313-8 of the Consumer Code.
- décès
- perte totale et irréversible d’autonomie (PTIA)
- incapacité temporaire totale (ITT)
- invalidité permanente totale (IPT)
- invalidité permanente partielle (IPP)
- perte d’emploi
Le modèle de fiche que le code publie encore en annexe de l'article R. 313-8 est antérieur à la loi du 28 février 2022 : ce site n'en publie donc pas la liste comme étant celle du modèle en vigueur. Les définitions de la carence et de la franchise qu'il porte, elles, sont stables et sont celles du marché.
- En vigueur depuis le
- Source
- Légifrance
No text fixes the number of days: yours is in your policy schedule, in the paragraph of the guarantee.
The timeline, from adherence to the first payment
| Marker | What happens | The running counter |
|---|---|---|
| Adherence to the contract | You pay your premiums | The waiting period begins, if there is one |
| End of the waiting period | The guarantee becomes mobilisable | No more counters |
| Day of the event | Stoppage of work is established | The deductible begins |
| Declaration to the insurer | The file is opened and processed | The declaration period provided for in the contract is assessed here |
| End of the deductible | The event ceases to be at your expense | The indemnity becomes due |
| First payment | The insurer pays, often in arrears | — |
The deductible starts from the event, not from the declaration. Declaring late does not lengthen it, but may cause the loss of the guarantee.
The waiting period: the guarantees it blocks
Common in the case of unemployment and certain conditions, rarer in the case of death. It begins on the effective date of the policy, not on the release of the funds.
It is almost never waived, and may carry over to a new contract: please verify this before changing insurance (the Lemoine Act).
The deductible: three parameters
Its duration in days, its starting point, and whether it is continuous or not: do successive stoppages for the same cause accumulate, or does each one start from zero?
- The third is the most costly: with a deductible that resets at each stoppage, spaced-out stoppages may trigger nothing. Look for the ‘relapse’ clause.
- Waiving the deductible is of no use if your employer maintains your salary beyond that point.
- Back and mental health: extended deductible, hospitalisation required, or no coverage in many contracts.
Your cash flow during the deductible
- Payment in arrears: allow for one additional period.
- Payment to the lender, to the extent of your share.
- The instalments continue throughout the deductible: it is this calculation that determines whether to waive it.
The ‘waiting period’: a commercial term
No text defines it. Please read the clause: if counted from the policy inception, it is a waiting period; if from the event, a deductible.
In the case of disability, request the assessment upon consolidation
The benefits are payable after the recognition of the disability by the insurer. Between consolidation and this recognition, nothing is paid. Please request the assessment in writing as soon as consolidation is announced, and keep the date of each dispatch.
Notification and limitation periods: two further deadlines
The notification period is set by the contract (Article L. 113-2 of the Insurance Code); the period for bringing an action against the insurer is set by Article L. 114-1.
Notify as soon as the prescribed stoppage occurs: a delay may lead to a forfeiture of rights provided for in the contract, if the insurer establishes that it has suffered a loss.
Délai de principe posé par le premier alinéa de l'article L. 114-1 du code des assurances. Ce n'est pas le seul régime que porte cet article, et ce n'est pas toujours celui qui s'applique.
- En vigueur depuis le
- Source
- Article L. 114-1 du code des assurances — Légifrance
In the event of a dispute, read Article L. 114-1 in full: its starting points vary.
A longer deductible may lead to a refusal to change insurance
Le prêteur
La durée de franchise figure parmi les critères que la plupart des prêteurs retiennent dans leur sélection publiée : un contrat de substitution dont la franchise est plus longue peut être régulièrement refusé sur ce fondement.
- En vigueur depuis le
- Source
- Article R. 313-23 du code de la consommation — Légifrance
Lors de la première simulation
Article L. 313-10 du code de la consommation. La fiche met en regard, au même endroit, les exigences du prêteur et les caractéristiques du contrat proposé — délais compris.
- En vigueur depuis le
- Source
- Article L. 313-10 du code de la consommation — Légifrance
Four lines to check in your policy schedule
- A deductible, and which coverages does it apply to?
- The length of the deductible period, and when does it start?
- Does it reset to zero in the event of a relapse?
- Back and mental health: is there a separate regime?
Deductible period in months × insurance premium included (the formula for the monthly instalment): this is the precautionary savings to keep. Review the situation by telephone, with the policy schedule in hand.
This page is for informational purposes only. The activity of insurance intermediation is carried out as an ancillary activity to the activity of intermediation in banking operations: it does not constitute an offer of insurance, nor personalised advice on a specific contract.
Create your file: the insurance is compared with the loan.
Sources
Read next
- Home loan insurance in Lyon: Sandy MASCART
- Mortgage in Lyon: frequently asked questions
- Flat-rate or indemnity mortgage insurance: the clause that determines what you will receive Two contracts covering “ITT” may pay out your full instalment or nothing at all. Where to find the clause, and how to determine what it will pay you.
- Borrower insurance guarantees: what death, total and irreversible loss of autonomy, total and permanent incapacity, permanent total disability and permanent partial disability actually cover The five guarantees of loan insurance, in the order they apply: what triggers them, who decides, and the line in the policy document that settles it.
- “Your own profession” or “any profession”: the definition of incapacity that decides everything Two wordings, two worlds: depending on your contract’s definition, the same period of work incapacity either triggers the cover or does not.
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