Office Announces Public Rate Hearing for American Security Insurance Company’s Lender-Placed Insurance Program
The Florida Office of Insurance Regulation (Office) is conducting a public hearing to review the proposed rate filing for American Security Insurance Company’s property collateral protection program, also known as “lender-placed” or “force-placed” insurance. American Security is an admitted Florida insurer and has the largest market share of lender-placed policies with more than 142,000 representing a total premium of $508 million.
Lender-placed (or force-placed) insurance is coverage that a mortgage lender or bank purchases to protect its interests when the property owner fails to purchase property insurance. This often occurs during situations of abandonment and foreclosure. The premium cost is usually higher than conventional property insurance premiums and is then charged to the property owner. The high premium costs and the fact that property owners are often “forced” to pay for this coverage by the lender (mortgage lender/bank) has brought increased scrutiny to the industry.