#InsuranceClaim #PropertyInsurance #MortgageCompany #InsurancePayout #InsuranceRequirements #InsurancePolicy
If you’ve found yourself in a situation where your insurance company has given you money because your property didn’t meet insurance requirements, but now your mortgage company is saying that you owe them that money back, you’re not alone. This can be a confusing and frustrating situation, but there are steps you can take to navigate it effectively. In this article, we’ll break down what might be happening, what your options are, and how to protect yourself moving forward.
##Understanding the Situation
###What Happened with Your Insurance Claim?
It sounds like your property didn’t meet the requirements outlined in your insurance policy, which led to an undisclosed claim being filed. This resulted in your insurance company giving you money, but it seems there may be some confusion about whether or not this money was intended to cover repairs or if it was a payout for a claim.
###Why is the Mortgage Company Involved?
When you have a mortgage on your property, the mortgage company has a vested interest in ensuring that the property is maintained and in good condition. They may have been notified about the insurance claim and subsequent payout, and are now asserting that the funds should have been used to repair the property or paid back to them.
##Your Options Moving Forward
###Review Your Insurance Policy
Take some time to review the specific language in your insurance policy related to property requirements and payouts. This will give you a clearer understanding of what is covered and what your responsibilities are in the event of a claim.
###Contact Your Insurance Company
Reach out to your insurance company for clarification on the situation. Ask for a detailed explanation of the claim, the payout, and how it aligns with your policy. If there was no claim filed, request information on why you received a payout.
###Communicate with Your Mortgage Company
Open a line of communication with your mortgage company to discuss the situation. Provide them with any documentation or information you have from the insurance company, and inquire about their specific concerns and expectations regarding the payout.
###Seek Legal Advice
Given the complexity of this situation, it may be in your best interest to consult with a lawyer who specializes in insurance and property issues. They can review the details of your case and provide guidance on how to protect your rights and financial interests.
##Understanding the Legalities
###Waiver of Subrogation
It’s worth noting that if you received a payout from your insurance company without signing a waiver of subrogation, it may impact their ability to pursue repayment from you. A waiver of subrogation is a legal document that waives an insurer’s right to seek compensation from a third party in the event of a claim payout.
###Mortgage Requirements
Your mortgage agreement likely includes provisions related to insurance and property maintenance. Reviewing your mortgage documents will give you insight into what responsibilities you have in the event of an insurance claim and payout.
##Moving Forward
###Documentation and Record-Keeping
Throughout this process, it’s essential to keep thorough records of all communication and documentation related to the insurance claim, payout, and discussions with your mortgage company. This will be valuable if the situation escalates or requires legal intervention.
###Resolution
Your goal is to find a resolution that protects your financial interests and aligns with the terms of your insurance policy and mortgage agreement. This may involve negotiation, providing additional information to your mortgage company, or seeking legal recourse if necessary.
##Conclusion
Dealing with an unexpected insurance claim and payout can be overwhelming, especially when it involves your mortgage company asserting that you owe them the money back. By understanding the specifics of your insurance policy and mortgage agreement, communicating with all relevant parties, and seeking legal advice if needed, you can work towards a resolution that alleviates this financial burden and clarifies your responsibilities. Don’t hesitate to reach out for professional help in navigating this complex issue. You are not alone in this perplexing situation, and there are resources available to assist you in finding a favorable outcome.
Were they trying to wash money then realized they’ve sent to the wrong people? I don’t think there is such thing as pay them back double, it was their mistake in the first place no? 😳
Maybe is just free money by mistake. But set it aside for now and see what happens next.
It sounds like the insurance company won’t cover you so they refunded your premiums. Now the mortgage company is saying you need to pay for homeowners insurance and it costs double because you just spent what had been saved up in escrow for it, so you have to pay that back for last year plus pay for this year. Something along those lines
It sounds like the insurance company came out and did an evaluation and determined the property was uninsurable, so they cancelled your policy. They then sent you a prorated refund of your premium from the cancellation date. The mortgage company secured insurance on the property and sent you a bill for it.
You need to make the required repairs to the property ASAP and find insurance. Your old insurance may even reinstate the policy and backdate it, in which case the mortgage company can also cancel their insurance from that date.
Bottom line if you don’t fix it and get insurance, or you don’t pay the new higher cost insurance, the property will be foreclosed.
Yes
I agree
Small tree just barely touching house and some small amount of tallish weeds close to house on side
No they are more than doubling. my mother switched insurance companies from standard to very reputable insurance because lower rate and more coverage in the allotted time you are allowed before premiums were paid to any of the insurance escrow for the new yearbefore the issue began with check amount sent was 1800.00 and they want her to pay 5000.00 back??????
Let me clarify the new company she switched to gave her the check and no notification from the mortgage company on any cancellation was sent and so said the insurance company it wasnt officially cancelled we had a week or two to get repairs and we were still covered per insurance company, they only required photos sent of repair made
It is not clear from your post if the insurance is escrowed or not and it is also not clear if the premiums are paid up with the insurance company.
From what I am able to parse out here it would seem like your premiums were refunded due to cancellation. When the insurance company sends this type of denial letter they have to keep you in force for 30 days and then refund the remaining prorated premium. If you cure the issues you have to contact the insurance company and they will send another inspector. If they reinstate you then you still have to pay your premium.
At the same time you received the cancellation notice, your mortgage company also will have received one because they have an insurable interest in the property. At this point all they know is that your coverage is being canceled. When you take the mortgage you sign a document agreeing to keep insurance on the property for all perils that will at least cover the mortgage or cost to rebuild, and that you will keep your mortgage company updated as to your insurance policy information. The same document also specifies that if you fail to maintain coverage they will “force place” insurance coverage to the property. The force placed insurance is always very expensive because they deal with a company that is basically willing to insure anyone, particularly people who have failed to maintain coverage.
The good news is that if you have already had the inspector back out and paid your premium to the insurance company you can provide your proof of coverage to the mortgage company and won’t have to pay premiums for any time that you had your own coverage in force.
Everything about the forced place insurance will have been communicated to you in writing from your mortgage company prior to them taking action.
So was the policy put on cancellation notice and then your mother met the requirements in time to reinstate the policy? And then the mortgage company or escrow company made a double payment?
A lot of insurance companies return premiums to their insured not the mortgage company. If your escrow account should be paid that is where you refund that money to the mortgage company.
The agent has nothing to do with the mortgage company and has no idea if you have a negative balance with them or not. So it is likely they told your mom that money was for her because it was refunded to her.
If the mortgage company says a payment needs to be made to them then it needs to made (in most cases they’ll increase the mortgage payment until the escrow account is balanced)
This is very confusing… based on your post and comments, here is what I gather.
You had an insurance policy with company X that was coming up for renewal.
You switched to company Y for a lower rate.
Mortgage company paid company X for the upcoming renewal. They ALSO paid company Y.
Company Y set a cancelation due to a poor inspection and issued a refund. Policy was still eligible to be reinstated with satisfactory inspection. Payment would have to be given back to company Y to reactivate the policy for the full term.
Company X sent you a refund as well.
The insurance company HAS to issue refunds to YOU, the insured, NOT the payor.
So you received 2 refund checks, 1 from X and 1 from Y. Somehow, you thought this was your money and could do whatever you choose with and spent in. While infact its your mortgage companies money. Payment needs to be issued back to them.
I work for a major carrier. If the property doesn’t meet underwriting guidelines due to the condition of the home, they will refund you unused premium. When a policy is initially bound they are required to cover it for 45 to 60 days even if they find there is an issue. This gives you time to find other coverage. They will keep the pro-rated premium for the time the house was insured and will refund you any additional. Majority of the time this is sent directly to you. If you escrow you will want to put that money in escrow because when you pick up a new carrier they will charge your escrow again, and you don’t want that to be short.
I think you have misunderstood what happened. It is hard to understand what you are saying. Do you have a relative that can speak better English that can communicate with the mortgage company and insurance company to find out what exactly happened?