During the coronavirus, even the most preferred homeowners can find themself in an “insurance situation” when their current home policy gets canceled.
Maybe it was simply canceled because the mortgage company’s check was lost in the mail. Maybe there was an underwriting issue they emailed you that went to your spam filter.
Whatever the reason is, you are facing one of the most expensive home insurance issues you can have which is “Forced Placed Home Insurance Coverage”.
What is Forced Placed Home Insurance?
Found under “§ 1024.37 Force-placed insurance.”, force-placed home insurance coverage is similar to private mortgage insurance or PMI. It’s a product that you agree to when you sign the terms and conditions on your property’s loan paperwork.
“Lender-placed insurance, also known as “creditor-placed” or “force-placed” insurance is an insurance policy placed by a bank or mortgage servicer on a home when the homeowners’ own property insurance may have lapsed or where the bank deems the homeowners’ insurance insufficient.” – NAIC
Lender-Placed Insurance isn’t “good insurance”, it’s definitely not “great insurance” either. It’s enough coverage to protect the lender’s interest in the event of a total loss.
It’s not a policy you should even entertain keeping. Even if you don’t go with the homeowner’s experts at Premier Shield, work with an independent insurance agent to compare and shop your options.
Working with local agents that are independent will help you find the best and most affordable policy.
How much is home insurance on forced-placed policies?
With prices for forced home insurance “You can expect to pay anywhere from 20-500% more for your home policy.” Every home is different, every lender is different, every forced-placed homeowner’s insurance policy is different.
A customer of ours from 3/31/2021 was recently in this exact situation. We were able to get our policy that was around $130/m on a 2,500 square-foot home. She was panicked by the forced coverage that her mortgage company put on was increasing her monthly mortgage payment by $700/m which is $8,400. We were blown away that such an expensive home insurance policy or company was legally allowed to gouge this nice lady for a simple missed mortgage payment.
Creditor-Placed Home Insurance Resources & Additional Information
The Lender-Placed Insurance Model Act (C) Working Group – Recent changes last year were drafted and adopted for a new model concerning lender-placed homeowners insurance coverage on policies. Learn more about the “Lender-Placed Insurance Model Act” and recently proposed changes.
Immediate Home Insurance Coverage
Stay calm, we help anxious homeowners in your situation all the time.
It will be OK!
We will help take care of everything with the home insurance and your lender. It can all feel overwhelming at times and you just want it all to go away.
At the Premier Shield Insurance agency, we are experts on this home insurance stuff and we feel the same way. We deal with all these companies to make it easy for you. All you need to do is provide us with the contact information of “who to send the home insurance policy documents” to.
You’ll keep getting a new agent on the line each time, you’ll get to hash out all the details and explain what you need again. You’ll have back and forth emails and additional questions that will take a lot of time to resolve your “forced placed homeowners insurance” problem.
You can choose a company like that or you can work with Premier Shield agents and we’ll stop whatever we’re doing to take care of this immediately for you.