Insurance company for backdated hazard insurance

5 Replies

Hi

I have a SFH property in Portland, OR that's rented out. I changed my insurance company from Foremost to Statefarm and ended up having a gap period from 10th to 27th June, 2018 without insurance. Mt mortgage company is now saying that I need to have insurance at all times and telling me that they will buy insurance on their own for this period if i cant show them proof that i had insurance during this time. How can one buy insurance for a period that's in the past? Also, there hasn't been any claim, so the mortgage company is not exposed to any risk...i don't understand this. Are there any companies that do backdated insurance?

Cheers,

Suren

@Surendra Chawla sorry, not possible.  Even if it was, it would be 10x's the cost of what the mortgage company would charge for the 15 days.

The mortgage company's insurance policy incurred the risk of covering your property while you were uninsured.  If you would have had a fire, that policy would have responded.

Keep in mind, State Farm may cancel you if they find out you were uninsured for those few days...It's a common guideline to have continuous coverage for 1-2 years to be eligible for a preferred insured policy.

Good luck with it.

Hi Surenda, 

I'm not sure about the backdating and Jason is clearly the expert there! What I do know is that one of the many, many things signed by a buyer at closing is an agreement to keep the property insured and authorizing mortgage companies to put insurance in place and bill the owner-and those rates aren't cheap. This is one of the key papers we explain to our clients while we're closing with them. 

As for the why, I can see your point of view that nothing happened, so why does it matter. If I switch hats and put myself in the insurer's shoes, I can see their points. One, you agreed to it. Two, just because there haven't been any claims now doesn't mean that someone didn't slip and fall during that time and just hasn't brought it up yet. Unlikely, but possible. 

I know that probably isn't the answer you're looking for. 

Best of luck!

Mathew

Originally posted by @Mathew Wray :

Hi Surenda, 

I'm not sure about the backdating and Jason is clearly the expert there! What I do know is that one of the many, many things signed by a buyer at closing is an agreement to keep the property insured and authorizing mortgage companies to put insurance in place and bill the owner-and those rates aren't cheap. This is one of the key papers we explain to our clients while we're closing with them. 

As for the why, I can see your point of view that nothing happened, so why does it matter. If I switch hats and put myself in the insurer's shoes, I can see their points. One, you agreed to it. Two, just because there haven't been any claims now doesn't mean that someone didn't slip and fall during that time and just hasn't brought it up yet. Unlikely, but possible. 

I know that probably isn't the answer you're looking for. 

Best of luck!

Mathew

 Years ago, I worked for an insurance company, and go around to audit insurance agents. One thing they do, sometimes on purpose is issue insurance binders, policies, and forget to report it to us, and yet collect premiums. The risk is if something happened, the insurance company is still responsible, and all they'll have to say is "oops, we forgot to report and pay you the premium". Often they shrug, say "nothing happened, what are you worried about". So I carry around a form, an affidavit that basically says that under binder# or policy number such as such between such and such dates, they will hold us harmless for any claims. So I say to them, if nothing happened you shouldn't have a problem signing this.

So if having to show continuous dates, if that's absolutely necessary, and nothing happened, OP can offer to sign a hold harmless affidavit for the dates involved, and have the policy backdated.