Insurance associated with the loan are some conditions that may be imposed on taking out credit. Furthermore, they can also make the installments more advantageous.

Insurance can be presented in different ways, but generally corresponds to life insurance (including accidental death) as well as multi-risk insurance (greater coverage).

These insurances are generally required by banks to grant credit. Especially when it comes to housing credit.

This requirement arises from the bank's need to reduce its risk when granting credit. In other words, suffering from non-payment of installments.

This insurance serves precisely to provide more guarantees to the creditor, that is, to the bank that grants the loan. Thus, he has less risk of default.

Since these insurances generally relate to the death of the consumer, or situations related to the home, they guarantee that this will not prevent the credit from being paid off.

Consider, for example, the death of a consumer who had a mortgage loan in payment. If he has life insurance, the credit will be paid off.

This will occur because the value resulting from the insurance, in the event of an accident, will be directed to the creditor bank, and not to the family. Thus, she remains in possession and ownership of the property.

However, be aware that only the insurance associated with the loan goes back to the bank. If the citizen has other insurance without association, the beneficiaries will be whoever they indicate when contracting.

No, but most banks require it. In other words: although the law does not require this contracting, it allows banks to require it.

Therefore, it is very common for insurance to be one of the requirements for obtaining credit in the market. In other cases, it remains optional, but tends to bring benefits to the consumer.

After all, in cases where it is optional, banks tend to offer lower interest rates, reducing the credit spread.

No, this is just the most common type of credit to require this type of insurance. Insurance can also be applied to other credit operations, such as:

The consumer has some guaranteed rights when taking out credit insurance. Discover the main ones below!

Firstly, know that Portuguese law gives the consumer the right to choose which insurer will be responsible for insuring credit contracts.

This means that the consumer does not need to use the insurance offered by the bank, which will also be responsible for the credit. He is free to look for another institution.

Therefore, instead of concentrating insurance and credit only at bank X, he can take out credit at bank X and insurance to secure the installments at bank Y.

The guarantee for this operation is found in Decree-Law 222 of 2009. It is important as it is common for consumers to find insurance with lower values in institutions other than the credit grantor.

Another consumer right is to transfer insurance to another insurer while paying credit installments.

In other words, even if the credit is granted under the protection of insurer X, the consumer can transfer the insurance to Y, without loss.

This choice is always up to the consumer. It should occur when the conditions of another institution prove to be more beneficial.

There are two advantages that stand out. One refers to the possibility of savings. The other is peace of mind regarding the future of payments.

The first advantage refers to the possibility of obtaining lower interest rates. This happens because the risk of the bank that grants the credit encounters fewer risks.

Therefore, it is possible that there will be a limitation on the spread, that is, on the profit that the bank would have in the face of greater risks. This way, you save on monthly installments.

Another important point of insurance associated with loans is peace of mind. The consumer is more at ease knowing that if something happens to them, their family will not lose the property.

After all, the value of the insurance goes back to paying off the insurance when one of its coverages is met.

In this case, the amount contracted for insurance is paid to the bank that granted the loan, in accordance with the contract.

Upon receiving the amount, the bank pays off the debt and credit. In this way, the property becomes, definitively, the property of the family, who can sell it, rent it or occupy it.

These are life insurance and multi-risk insurance. Below, find out more about each of them.

One of the main ones refers to life insurance. There is a guarantee that if the contractor dies, the credit will be paid off by the insurance premium.

This generally includes natural and accidental deaths. It may also include cases of accidents that cause total or partial, temporary or permanent disability.

Another type of insurance associated with loans is multi-risk. Although it generally relates to household issues, it may have other coverage, including life or personal accident coverage.

However, when it comes to the home, it generally insures against fires, robberies, thefts, alterations resulting from natural phenomena, electrical problems and others.

Finally, if you want to know more about loans and are really looking for one, see below tips on how to get one and get your questions answered!