Insurance companies, brokers and even your relatives: everyone advises you not to leave anything out when you sign your insurance contract. However, a misrepresentation, whether intentional or not, can still lead to support. As reported by the insurance broker, who has just analyzed one of the practical cases he was confronted with, the penalties provided for in the Insurance Act apply in case of forgetfulness when signing your contract. know your medical history.
In the case studied, a person took out a mortgage and decided to have it covered by an insurance company. The latter therefore had to take over from the borrower in the event of total temporary incapacity (ITT) to repay the loan installments. In this context, the individual was encouraged to provide their medical history using the medical questionnaire. This formality allows insurance companies to understand the risk a customer represents. The latter is therefore forced to reveal the existence of a serious illness – diabetes, sclerosis, cancer – under penalty of not receiving compensation on the day he is no longer able to repay his mortgage.
>> Our service – Save money by testing our home loan insurance comparator
Borrower insurance: the gains you can expect with the new liberalization law
The omission is not fatal
However, our subject did not declare his pathology. He even decided, a year later, to cover another mortgage, still with the same insurance company. The formalities are identical: complete a medical questionnaire and declare any pathology. This time he bows to the game and informs his insurance company that he is suffering from an illness.
Borrower Insurance: To get your mortgage repaid, forget about contractual termination
A year later he fell ill, went on sick leave and decided to use the ITT guarantee for his first contract. The insurance simply refuses, recalling that the client had not declared the existence of this medical history. For this, it relies on article L.113-9 of the Insurance Act. End of story? None. This is where the insured knew how to be mischievous, reminding him that the company was fully aware of the facts as his state of health had been investigated as part of the questionnaire for his second policy.
That was decided by the Court of Cassation
“The Court of Cassation has long ago admitted (1999, editor’s note) that if the insured establishes that the insurance company was aware of the undisclosed circumstance, he can avoid the prescribed sanctions in the event of incorrect risk declaration”, thus recalls Arnaud. Chneiweiss, the insurance broker. In this case, a letter from the insurance company’s medical adviser, sent to the person under his second contract, had even invited him to complete a questionnaire more specific to this pathology.
The insurance company is therefore not entitled. Therefore, the broker invited him to activate his client’s ITT guarantee. However, he reminds that the individual must answer exactly the health questions that the insurance company asks. And to emphasize the risks incurred: “Any omission, even without a direct connection to the occurrence of the claim, may deprive the insured of coverage from the insurance company.”
Receive our latest news
Each week the most important articles should accompany yours Personal finance.