Force-placed insurance is a type of insurance that occurs when a homeowner’s own insurance lapses (legitimately or not). How does your own insurance lapse? Well, it could be by mistake – maybe you changed bank accounts and forgot to change the auto withdrawal information. Or maybe your insurance company forgot to supply the right paperwork to the mortgage company. Nonetheless the slightest lapse gives your mortgage lender license to place an insurance policy of their own on your home.
And that insurance policy is not in your favor.
For starters, it is a policy that you have no control over – yep, you pay for it but you don’t choose it; you don’t get to compare price quotes or study the coverage. You just get it, whether you need it or not.
That’s why we’ve made the list below of things to look out for in your monthly statement. If you see any of these telltale signs below, you may have been charged for force-placed insurance. And what that means is that you are paying much, much more than other homeowners for your insurance and yet be receiving much, much less coverage.
Here’s what you need to watch out for:
Part One: — If your mortgage is with OneWest Bank, BB&T Mortgage, Ally Financial, PHH Mortgage, Ceniar FSB, Fifth Third Bank, Aurora Bank, American Home Mortgage Servicing, Flagstar Bank, Everbank, M&T Bank Corporation, MetLife Home Loans or PHH Mortgage. Watch out! Because, if you:
- Do not have homeowner’s insurance because you never purchased a policy.
- Had your policy cancelled because your renewal premium was not paid.
- Did not receive proof of your insurance coverage (— even if they had their coverage in place).
- Did not purchase coverage that met your lender’s requirements, either in the type of coverage (flood, fire, etc), the amount of coverage, or the deductible.
Now, we hear you. It’s confusing! Who knows!? That’s why, if you’ve experienced any of the following:
- If your homeowner’s insurance just went up in price without any warning…
- Or, if you filed a claim with your insurance only to learn that you were not covered for such claims, even though you believed your homeowner’s insurance did…
Then, IT MAY HAVE HAPPENED TO YOU.
Homeowners and taxpayers alike deserve a break; let’s make these bankers and insurers accountable. No more fishy business!