# Life & house insurance costs for mortgage - extortionate?



## el romeral (May 8, 2012)

Just been rumaging through the usual multitude of papers and bumf which appears from the banks :tape2::doh:. I do not usually pay much attention to it, as I do not understand it all - my wife does though. 
I enquired about 2 amounts related to our mortgage with Banco Pastor (Popular).

It turns out we pay 4 x 260E = 1040 E per year for my life insurance (Pastor Vida) and 4 x 175E = 700 E per year for house insurance (Axa Seguros) :scared:.

I was somewhat shocked by these amounts :fear:. I understand that we have no choice and have to use these companies due to the bank we are with? :fish:

Just wondered what others are paying for life and house insurance and if my costs are normal (whatever that is round these parts)? :noidea:


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## mazlester (Oct 30, 2010)

House and contents are 360euros a year that's with Zurich. 700E is extortionate!!!


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## xabiaxica (Jun 23, 2009)

el romeral said:


> Just been rumaging through the usual multitude of papers and bumf which appears from the banks :tape2::doh:. I do not usually pay much attention to it, as I do not understand it all - my wife does though.
> I enquired about 2 amounts related to our mortgage with Banco Pastor (Popular).
> 
> It turns out we pay 4 x 260E = 1040 E per year for my life insurance (Pastor Vida) and 4 x 175E = 700 E per year for house insurance (Axa Seguros) :scared:.
> ...


my life insurance is something like 200€ a YEAR


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## 213979 (Apr 11, 2013)

el romeral said:


> Just been rumaging through the usual multitude of papers and bumf which appears from the banks :tape2::doh:. I do not usually pay much attention to it, as I do not understand it all - my wife does though.
> I enquired about 2 amounts related to our mortgage with Banco Pastor (Popular).
> 
> It turns out we pay 4 x 260E = 1040 E per year for my life insurance (Pastor Vida) and 4 x 175E = 700 E per year for house insurance (Axa Seguros) :scared:.
> ...


 
Oh man, they were just talking about this on the radio. They said that you are NOT obligated to take the bank's insurance. I might contact a consumer's organization to figure something out. We pay substantially less a year for both house and life insurance.


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## VFR (Dec 23, 2009)

Yes I read something a while back about this scam & how the law was changed so you can insure with who you wish ?


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## leedsutdgem (Jun 3, 2010)

el romeral said:


> Just been rumaging through the usual multitude of papers and bumf which appears from the banks :tape2::doh:. I do not usually pay much attention to it, as I do not understand it all - my wife does though. I enquired about 2 amounts related to our mortgage with Banco Pastor (Popular). It turns out we pay 4 x 260E = 1040 E per year for my life insurance (Pastor Vida) and 4 x 175E = 700 E per year for house insurance (Axa Seguros) :scared:. I was somewhat shocked by these amounts :fear:. I understand that we have no choice and have to use these companies due to the bank we are with? :fish: Just wondered what others are paying for life and house insurance and if my costs are normal (whatever that is round these parts)? :noidea:


Hiya. You cannhave insurance with whoever you like, those prices are a disgrace. Whats your spanish like? There are plenty of comparison websites here and thats where i got mine from. I have moved everything away from Unicaja as 1. They were at least 30-40% more expensive than generali and 2. We have a clausula suelo with them so theyre already robbing us by charging 3.5 % interest rate on our mortgage when euribor is like 0.50 but thats another story sorry fpr going off topic.


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## missbusybusy (May 11, 2013)

If coming away from the banks insurances, Did you use a Broker for the insurances ?


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## el romeral (May 8, 2012)

Thanks for all replies and advice. Not been on earlier as our campo satellite internet was down all day.
My wife speaks Spanish as the locals do so we have no problem getting sorted out. She was told by the bank, when we had our mortgage set up, that we had to use their insurances. We have therefore been paying these inflated amounts for years. I thought the 3 month demands were the yearly amounts!
Do not have anything good to say about the banks here as they are all thieving scum. We also have the suelo clause to contend with. We nearly lost our house some years ago when (unbeknown to us) the bank was diverting our mortgage payments into the account of my wife's (then) struggling business. We mistakenly had the same bank for both. Unbelievably we were then defaulting on our mortgage in their eyes. The only way we were able to sort it was to make a one off payment of 16000 E (mainly rip off interest). 

Sorry, got sidetracked - blood pressure now returning to normal......

Have received some much lower house insurance quotes, will get more tomorrow & life insurance ones. Hopefully can save about 1000 E a year.


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## leedsutdgem (Jun 3, 2010)

el romeral said:


> Thanks for all replies and advice. Not been on earlier as our campo satellite internet was down all day. My wife speaks Spanish as the locals do so we have no problem getting sorted out. She was told by the bank, when we had our mortgage set up, that we had to use their insurances. We have therefore been paying these inflated amounts for years. I thought the 3 month demands were the yearly amounts! Do not have anything good to say about the banks here as they are all thieving scum. We also have the suelo clause to contend with. We nearly lost our house some years ago when (unbeknown to us) the bank was diverting our mortgage payments into the account of my wife's (then) struggling business. We mistakenly had the same bank for both. Unbelievably we were then defaulting on our mortgage in their eyes. The only way we were able to sort it was to make a one off payment of 16000 E (mainly rip off interest). Sorry, got sidetracked - blood pressure now returning to normal...... Have received some much lower house insurance quotes, will get more tomorrow & life insurance ones. Hopefully can save about 1000 E a year.


Hi there, you can now fight the clausula suelo and possibly get your money back. i have started a topic about this below.


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## el romeral (May 8, 2012)

Is life insurance compulsory in Spain when you have a mortgage with the bank? Is there a minimum cover required?


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## caromac (Nov 16, 2008)

el romeral said:


> Is life insurance compulsory in Spain when you have a mortgage with the bank? Is there a minimum cover required?


When we took our mortgage 7 years ago we did not have to take Life Insurance. Some neighbours did. I assumed therefore that it depended on the bank. Worth an ask to see where it says so in the contract.
Lets hope there are some mis-selling compensations :fingerscrossedn the cards


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## el romeral (May 8, 2012)

caromac said:


> When we took our mortgage 7 years ago we did not have to take Life Insurance. Some neighbours did. I assumed therefore that it depended on the bank. Worth an ask to see where it says so in the contract.
> Lets hope there are some mis-selling compensations :fingerscrossedn the cards


It is a nice thought, can't see this bank doing anything in our favour ever.

Been in touch about our rip off house & life insurance policies. 
We pay these every 3 months. Apparently we are not able to cancel them until the end of July next year as this is when the renewal date is. This can't be right can it? If I were to tell the bank to cancel the direct debits from now on, can the insurance companies do anything about it? Am thinking specifically about embargoes and other such "routine" practices round these parts......


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## gus-lopez (Jan 4, 2010)

Check the policies.


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## el romeral (May 8, 2012)

gus-lopez said:


> Check the policies.


Errr, yes that has been done. Also on the phone they said we need to continue to end of July next year. However, between now and then there are 2 more direct debit payments for each policy. 

What I am asking is, if I cancel these payments with the bank, is there anything the insurance companies can do about it?

Surely, if they offer the choice of paying in this manner then they run the risk of rattled customers pulling out before the end of the year's policy?


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## gus-lopez (Jan 4, 2010)

It must state somewhere in the policy what the cancellation terms are ? Very peculiar if it doesn't. 
I can't see what they could do about it as it is not like car insurance where you legally have to give them 2 months notice to terminate at year end .


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## jaynee (Jul 12, 2012)

Hi :noidea:

This is an insurance added and not even for the full term :confused2:

A Mortgage has been pre approved for us by banco Sabadell spain..

But.... Their life insurance .. Is not covering the mortgage term of the 17 years,

And we are told by the broker that you cannot have a separate life insurance ..
Yet other general insurance brokers say you can ..

The mortgage term is 17 years and we are only getting cover for the term of 10 years.

This is in no ones best interests and we are so confused about it 

Mortgage is actually for 163,000€ ......we have a good cash deposit too..

They are wanting to add and extra 18,900€ for a 10 year (not 17 year) life insurance cover for the both of us but to only cover 71,000€ not the mortgage amount .. 
adding this 18,900€ on top of the 163,000 mortgage making it 181,900€

Scary situation..
We are ages 51 & 50

anyone have any info at all


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## snikpoh (Nov 19, 2007)

jaynee said:


> Hi :noidea:
> 
> This is an insurance added and not even for the full term :confused2:
> 
> ...



Do NOT take their insurance - it is NOT mandatory (IMHO).


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## jaynee (Jul 12, 2012)

Hi 

We havent seen any thing yet..

This is just a pre approval and a rip off weird life insurance that they never tell you about in first line of enquiry..

They send all the figures and repayment initially and you go further and give supporting papers proof of income etc etc 

Then they send you the final figures and term and stick this life insurance on thats never been mentioned before .. Its like the mis sold scenario..

We havent said yes... Or even seen the policy yet ..

Jay


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## Dunpleecin (Dec 20, 2012)

When I bought my place last year, they added over 1000€ for house insurance. That was Liberty Seguros. This year it went down to €200 with linea directa. When I realised this and asked the solicitor why it was so much she just said they can basically charge what they want when you're buying the property. I suppose if they thought it was going to be standing empty most of the time as just a holiday home I could expect a larger premium, but if anyone knows is there is any comeback on this I'd be interested...


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## Pazcat (Mar 24, 2010)

A 10 year policy seems a bit over the top.

I can see why a bank would want to make it a condition of contract and from what I can tell it is not compulsory but many banks do insist on it, after all it is not compulsory for them to give you a loan either.

We have to take it out with our mortgage as well but will make sure that we can change to an independent policy at a later date.
I wouldn't sign a 10 year policy though because once you have then you are locked in. 

I would at least try and argue that point with them, maybe take a years worth of insurance from them and see what they say.
Once you do see the policy then that is something you will need to keep a close eye on but I'm fairly positive it is illegal for them to insist on using their own insurance for the entire term. So whilst it may be a condition of sale they can't stop you from changing at a later date.


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## Dunpleecin (Dec 20, 2012)

I've looked at the house policy documents I have and have just noticed that my policy is a 5 year policy, so given that it was 1000€ it's probably not surprising. However, I didn't realise this at first and took out a policy with Linea Directa earlier this year thinking the LS one had run out. As it hasn't I need to cancel one. I'm going to go into LS later to see if I can cancel that one. Not sure if it will work though. I might be better cancelling the LD one.


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