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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California Insurance Commissioner Dave Jones requests reduced rates from “forced-placed” mortgage insurance companies

Insurance Commissioner Dave Jones has spoken with the 10 biggest insurers providing “lender-placed coverage” California insurance, in order to address a number of concerns that have been brought to his attention regarding excessive rates. Within that communication, Commissioner Jones directed that a California Department of Insurance (CDI) rate filing be made in order to lower their rates. The insurance commissioner too this step at a time when reports have been made quite heavily regarding sketchy financial integration between insurance companies that offer “forced-placed” mortgage insurance, and the mortgage lenders themselves.…

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