A borrower has the right from his bank to information about insurance, even if he declines the insurance offered to him with the credit.
The bank’s obligation to provide information regarding insurance
The Court of Cassation therefore rejected the argument that the bank’s obligation to provide information on the extent of the risks to be covered would cease as soon as the customer refused to subscribe.
It is up to the insurance company that this borrower will ultimately contact to provide information on the adequacy between his personal situation and the contract that it will offer him, the banker said.
He was the subject of a lawsuit brought by a person who had started buying and renovating a home to rent it out, but who, after refusing the insurance offered by the bank, had become seriously ill, could no longer work and was having difficulty paying back.
The decision and treatment of the Court of Cassation
The banker is only required to provide information about the insurance he offers, replied this lender, who was accused of a breach. This customer preferred to seek insurance from other organizations and it was therefore up to them to advise him on adapting their contract to his personal situation. As for the principle of insurance or non-insurance, it is a matter of the management of the customer’s affairs in which the lender should not interfere, the bank concluded.
Nevertheless, the judges ruled, the bank had to inform this client of the risks and the adequacy of the insurance it offered and that, when it saw him refuse this insurance, it had to “advise him of the risk of an insurance default” . And it must be able to prove that it has complied with these obligations. If this is not the case, the request for substantial compensation, which in this case amounted to an amount close to the credit to be repaid, must be considered.
Legal reference: Cass. Come, 2.5.2024, D 22-21.642
