Insurance Regulators To Hold Hearing On Lender-Placed Insurance
|Targeted News Service|
Lender-placed insurance is imposed by a bank or mortgage servicer on a home when a mortgage holder fails to maintain required insurance. Recent discussion has focused on the rates charged for lender-placed policies and the possible harm this type of insurance may do to consumers.
"This hearing will give regulators the chance to hear from consumers, the industry and financial institutions about the use of these types of homeowners policies," said
The hearing will focus on the use of lender-placed insurance, how consumers are affected by the practice, and expected to probe the following issues:
* The process for lender-placed property insurance and its impact on homeowners, including a review of the relationships between lenders/mortgage servicers and insurers;
* Whether coverage is being imposed on consumers retroactively;
* Disclosures used to inform consumers about lender-placed property insurance;
* Coverages provided by lender-placed insurance; and
* Premiums charged, loss ratios, and related rating and pricing information.
"We want to know more about rates, consumer disclosures and how the relationships many of the insurers have with the lenders affects the transactions," said
An agenda for the public hearing will be posted to the committee Web pages at www.NAIC.org when it is finalized.
View the public hearing notice here (http://www.naic.org/documents/committees_c_120809_public_hearing_lender_placed_insurance.pdf).
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