Forced place insurance lawsuit filed against Wells Fargo

force placed insurance

Bank accused of charging its mortgage clients inflated homeowners coverage premiums. A lawsuit has been filed against Wells Fargo Bank NA, which has accused the company of charging inflated force placed insurance premiums to homeowners who had allowed their coverage to lapse. The complaint stated that the inflated premiums are designed to cover kickbacks. The Fort Lauderdale, Florida federal court received the filing, in which homeowner Ira Fladell stated that “The premiums are inflated to cover kickbacks in the form of unearned commissions and bundled administrative costs not properly charged…

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Force placed insurance most common in Florida

Forced Placed Insurance

California came in second for the state with the most premiums collected. According to sworn testimony regarding force placed insurance, before the United States Judicial Panel, Florida has the largest share of premiums from these policies. Its share was 35 percent of the entire country in 2011, equaling about $1.2 billion. The state was among the highest for home foreclosures in the country, and the majority of people whose mortgage payments defaulted also stopped paying their insurance premiums. This meant that many people had the force placed policies imposed in…

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Force placed insurance policies to be the topic of official questioning

Florida Homeowners Insurance

Florida regulators will grill Praetorian execs as well as those from two insurers. Regulators in Florida will be questioning executives of two insurers and Praetorian Insurance Company this week regarding their policies and behaviors regarding force placed insurance policies. Significant controversy has been growing around this form of coverage. These policies are imposed on homeowners by lenders when coverage on the mortgaged property has been allowed to lapse or expired, as they are often sold by companies whose rates are unregulated, by surplus lines insurers, or by companies that are…

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New York regulators announce price reduction for forced placed insurance

New York Homeowners Insurance Rules

Homeowners to see some relief from ultra high premiums. The top financial regulator in New York state has ordered that forced placed insurance on homeowners policies be provided at a lower price, following a probe that determined that companies had been overcharging their customers. The deadline for the changes to the premium rates has been set at July 6, 2012. Benjamin M. Lawsky, the superintendent of the Department of Financial Services set the deadline for the filing of new price on the coverage for homeowners in New York, within this…

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Forced placed insurance can cost three times more than a consumer-purchased policy

Forced Placed Insurance

Standard homeowners insurance often costs a third of the premiums of lender-placed coverage. When forced placed insurance is purchased on behalf of a mortgage customer who has not kept up with homeowners insurance payments or who has failed to obtain coverage, it is typically to the property owner’s detriment, as many of these individuals are being severely gouged by their loan servicers for this protection. This form of coverage is designed to provide banks and other mortgage lenders with protection against losses on properties on which they have loaned money…

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Force-placed coverage causes probe of New York insurance companies

A closer look into forced placed insurance practices The state insurance regulator in New York is currently performing an investigation as to whether or not the rates for force-placed insurance that are being charged by companies should be deemed excessive, and is requesting data from insurers such as Assurant Inc. The New York Department of Financial Services released a statement that said that it is trying to obtain basis for “consistently high profits” that are occurring at the investors’ and homeowners’ expense. It is also requiring that insurers such as…

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