To insure a loan is more profitable for the bank than for the borrower. After all, if something happens to the borrower, the insurance company will pay off the loan for him. But for insurance, the payment on the loan will cost more, and if nothing happens to the borrower, it turns out that the money was wasted. And, as you know, there is no extra money. Will the insurance be returned if the loan is repaid ahead of schedule? Applicable laws and proposed innovations.
Can banks prohibit early repayment of a loan
In this situation, the law is on the side of the borrower. The borrower has the right to repay the loan ahead of schedule (this is directly stated, for example, in part 4 of article 11 of the law on consumer loans). Before repaying a loan to a bank early, you should definitely look at the features of early repayment in your own loan agreement concluded with a particular bank. Banks cannot prohibit early repayment of the loan. However, the borrower is obliged to comply (as well as the bank) with the terms of the loan agreement.
You can repay the loan ahead of schedule, either in full or in part
This is due to the fact that in 2011 Russia adopted a law (No. 284 of 2011-19-10), which allowed the parties to "painlessly" repay the loan ahead of schedule - for such repayment, borrowers are not charged fines and penalties, and banks remain with interest under the loan agreement (since interest is included in the early repayment amount).
The right to return insurance
Citizens have the right to a loan insurance refund if the contract specifies the right to a partial refund of the insurance. If it is not indicated, then the insurance will not be returned (even through the court).
What is the best way to proceed
First, you need to carefully read the terms of the agreement on early repayment of the loan and understand the right to a partial return of insurance - whether it is in the agreement or not.
Secondly, the borrower needs, no later than a month before the expected date of repayment, to apply to the bank with a written application for early repayment of the loan, and also write an application for a partial return of insurance to the insurance company (respectively, if a partial return of insurance is possible under the terms of the insurance contract). You can, of course, confine yourself only to an application to the bank (in which you immediately indicate two such points), but for efficiency and increase the chances of returning the insurance, it is advisable to contact the bank separately and separately to the insurance company.
Draft laws on the return of insurance for a loan
At the moment, 2 bills have been prepared (dated June 18, 2018), guaranteeing the return of insurance in case of early repayment of the loan. But these are just bills. In order for them to be applied, they need to take effect.
The insurance company refuses to return the insurance, despite the terms of the contract
Of course, the insurance will not be returned if the insured event (from which the loan was insured) has already occurred. It is simply pointless to hope that some money will be returned in this case.
If the insurance event did not occur, and the insurance company or bank refuse to return on the grounds that, for example, there is no right to return the insurance, the borrower needs to carefully read the terms of the contract again, and if such a right is provided there, then you need to write claims and go to court or file complaints out of court. In any case, if there are controversial issues, the borrower can always contact a qualified lawyer with a question.
