Termination at any time after one year (Hamon law)
The right, created by the 2014 consumer law, to cancel motor, home and affinity insurance at any time after one year, which strengthened competition and shortened contract lifetimes.
The March 17, 2014 consumer law, known as the Hamon law, created in article L. 113-15-2 of the French Insurance Code a right to cancel at any time, after the first year, insurance contracts taken out by individuals outside their business and covering vehicles, the home, or supplementing a good or service. In force since January 1, 2015, the right is exercised without fees or penalties, termination taking effect one month after notice to the insurer. For compulsory insurance, motor and tenant liability, the new insurer handles the formalities, ensuring continuity of cover. The scheme was extended in 2022 to supplementary health insurance and, through a separate law, to borrower insurance. Its market effects are lasting: the end of the annual commitment intensified price competition, shortened contract holding periods and raised acquisition cost relative to premium. For personal lines underwriters, it requires reasoning in customer value over an uncertain duration, and it fed the debate on price walking toward loyal customers.
An individual with home insurance for eighteen months finds an offer 25 percent cheaper. He takes out the new contract, whose insurer notifies termination to the old one; it takes effect one month later, free of charge, whereas before 2015 he would have had to wait for the annual renewal and give two months' notice.
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