Insurance for a Diabetic

[Juan Correia]

My wife and I live in Portugal and we have been doing investment in RE for some time now. We bought our first houses on our twenties, basically for buy and hold, using regular bank loans.

When she turned 30, she was diagnosed with Mody (Maturity Onset Diabetes of the Young) diabetes (a rare string that appears after later).

We went to our (all life) bank to ask a loan for yet another investment and, of course, given her new condition, her life insurance more than doubled (I don't know how it works in other countries, but here the bank demands a life insurance with each loan). Now you have two options, either you do it with the bank (of course a more expensive insurance) or you do it with an external company (the loan conditions are worst with this option and you get a higher interest rate, but it's still cheaper when everything is compared). The bank will, however, require you to have the SAME type of conditions in the external insurance as the one they have proposed (in terms of coverage).

Now comes the funny part:

After accepting the external insurance and lending the money, the bank started the take out money every month, and the bank statement came as an insurance charge. I called the bank and ask about this, given that we chose the external option... the bank replied that the external insurance didn't cover exactly the same as the bank's insurance and therefore, they had to activate their insurance to meet with the banks requisites...

Now the REALLY funny part:

I called my broker and told him about the situation, we set down and compared the policies and there were EXACLY the same... with one detail extra from the external company: my wife condition demands a specialist (doctor) to make a verification of her health status prior to signing off the insurance... this is mandatory for all insurances, and the bank activated their insurance WITHOUT this verification... So the bank insurance is not valid, meaning that, if (god forbid) something happens, the banks insurance is not valid...

I sent this to my lawyer who's proceeding to clear everything out, but I wanted to share with you guys my history. Of course, I only found out that the bank was charging me, because I carefully control my bank statement...

Thoughts?