Force-placed insurance is homeowner's or property insurance that a creditor or lender such as a mortgage company forces a borrower to accept when their homeowner's police lapses, is not renewed or the creditor decides that it needs more insurance to cover its interests. Usually, this type of force-placed insurance is more expensive than what the borrowers could have obtained on their own. Sometimes, the lender takes advantage of the situation even more and overcharges the borrower for the force-placed insurance outrageously. This has recently resulted in very large multi-million dollar settlements with HSBC ($32 million), JP Morgan Chase ($300 million), Citigroup ($110 million) and a pending settlement of similar claims with Wells Fargo as reported by Bloomberg News, HSBC To Pay $32 Million Over Insurance Claims.
Questions: did you mortgage company force you to accept more insurance than was necessary? was the cost of the new insurance much greater than what you had before?
Lexington, Kentucky insurance lawyer Robert Abell represents individuals and families as to insurance claims; contact him at 859-254-7076.
