Buying a home in France with no borrower insurance after 65

In France, a mortgage taken out without borrower insurance (assurance emprunteur, the cover that repays the loan if you die or become disabled) is perfectly legal. No statute forces you to buy that cover. It is the lender that asks for it, and the lender can waive it if it holds another form of security that protects it just as well.

The issue tends to surface after 65 or 70. Bank group policies often stop accepting new members at a set age, medical loadings climb steeply for anyone with a health history, and some guarantees are simply no longer offered. Many English-speaking retirees in France reach this point with a pension that comfortably supports the repayments, yet the file stalls because nobody will insure the capital. The good news is that a French bank can still say yes when you bring the right substitute guarantee to the table.

Why the bank insists, even though the law does not

The Code de la consommation (France's consumer code) regulates how borrower insurance is chosen, including your right to pick an outside insurer instead of the bank's own policy, a practice called délégation d'assurance. It does not make insurance compulsory. Almost every loan offer nonetheless lists it as a condition, because it is the bank's main protection against the borrower dying with a balance outstanding.

The lender's real worry: an estate that walks away

Without insurance, any remaining debt passes to the estate. French heirs are free to refuse an inheritance, and if they do the bank faces a long, uncertain process to seize the property or claim against an unclaimed estate. That is why a lender will drop the insurance requirement only when it has an asset it can turn into cash quickly: a pledged savings policy, a first-ranking mortgage charge or a solvent guarantor.

There is a helpful side effect. The 35% debt-to-income ceiling set by the HCSF (Haut Conseil de stabilité financière, the French financial stability board) is measured with insurance included. A file with no premium therefore shows a lower effort rate, which can make approval easier once the replacement guarantee is solid.

First, make sure no insurer will really cover you

Giving up on insurance too early is a classic mistake. The loi Lemoine (2022 law on borrower insurance) lets you switch insurer at any time and removes the health questionnaire for smaller loans ending before your 60th birthday, which mainly helps people in their fifties. The AERAS convention (the French framework for insuring people with a serious health risk) provides for a deeper review of difficult cases, and the five-year right to be forgotten covers cured cancers. A specialist broker can also look for death-only cover, which remains available well after 70 with several outside insurers.

For British, American or Irish retirees, a life policy taken out in your home country is sometimes accepted if it is assigned to the French bank, but many lenders refuse foreign policies they cannot easily enforce. Ask before relying on it.

The four substitute guarantees side by side

Accepted files almost always rest on one of four mechanisms. Their cost and accessibility differ widely, and the right one depends on what you own.

Worked example: a 71-year-old turned down by two insurers

Take Michael, 71, a retired engineer living in the Dordogne with a combined French and UK pension of €3,500 a month. He wants a €160,000 flat closer to his daughter in Bordeaux, putting in €40,000 of his own money and borrowing €120,000 over 10 years. A past heart condition has earned him two insurance refusals. His assurance-vie (the French tax-favoured savings policy) is worth €150,000, with 80% in the capital-guaranteed euro fund.

How the deal was structured

The bank agrees to lend without insurance against a pledge (nantissement) of €140,000 of the policy. At 3.3% over 120 months the monthly payment comes to about €1,175, or 34% of his income, just under the 35% ceiling. Interest keeps accruing inside the euro fund, and Michael can still switch between investment options as long as the bank agrees.

Compared with insurance carrying a medical loading, the saving is real. A premium of 0.9% a year on €120,000 would cost about €1,080 in year one and close to €10,800 over the term if charged on the original capital. The pledge, by contrast, is set up with an amendment to the policy and a notice to the insurer, for a few hundred euros of fees at most.

What it means for the family

If Michael dies before the loan ends, the bank recovers the outstanding balance from the pledged policy and the rest goes to his named beneficiaries. His daughter pays nothing out of her own pocket, but she inherits a smaller policy. That trade-off is worth explaining to relatives in advance, especially if a beneficiary has formally accepted the policy, because that person's written consent then becomes necessary for the pledge.

Getting to a yes without insurance, step by step

Treat the process as a negotiation: the bank should see your counter-guarantee before it even studies the loan itself.

1. Collect at least three insurance quotes, including one from an outside insurer and one for death-only cover.
2. Keep every written refusal, since they justify your request to the bank.
3. Obtain a current statement of your assurance-vie or a valuation of the property you would mortgage.
4. Put the counter-guarantee on the table at the first meeting, with figures.
5. Have the notary or insurer confirm that no beneficiary has accepted the policy.
6. Compare the TAEG (the French APR): it falls without a premium, but guarantee fees are added in.

Where these applications go wrong

The most common reason for refusal is a counter-guarantee that falls short. A policy invested in volatile unit-linked funds only covers part of the loan, because the bank applies a haircut to its value. Other stumbling blocks include a property that would be hard to resell, a guarantor who is also elderly, or a term that runs past the maximum age the lender allows.

Mistakes that cost retirees dearly

Never hide a medical condition on a health form to get insured at any price. A false declaration can void the policy at the very moment your family would need it. Avoid pledging every euro of your emergency savings, and do not let an adult child sign a guarantee without making clear they will have to pay if you default. Non-residents should also check that rental income or a foreign pension paid into a non-French account will be counted: some banks want income domiciled with them.

Other routes worth exploring

The prêt viager hypothécaire (French lifetime mortgage) is repaid only on death or sale and needs no insurance at all; it is still offered from age 60 through the Banque Populaire and Caisse d'Épargne networks. A younger co-borrower who can be insured may carry the cover for both of you. An interest-only loan (prêt in fine) backed by an assurance-vie keeps monthly payments limited to interest, with the capital repaid from the policy at the end.

Frequently asked questions

Can a French bank refuse me because I have no insurance? Yes. A lender is free to grant or decline credit. What it cannot do is force you to take its own group policy when an outside insurer offers equivalent cover.

Does the APR change when there is no insurance? The TAEG must include every guarantee cost the lender requires. Without insurance it therefore includes the pledge or mortgage registration costs instead of the premium.

Can I pledge a share portfolio rather than an assurance-vie? Some banks accept a PEA (French equity savings plan) or an ordinary securities account, with a larger haircut than a euro fund because the value moves with the markets.

Is death-only cover enough for a retiree? Usually. Once you no longer work, incapacity cover has little purpose, and many lenders are satisfied with death cover alone.

At what age does cover become impossible to find? It depends on the contract. Some bank group policies close to new members around 70, while specialist outside insurers will still cover death risk at older ages.