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Joe Stout
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  • Investor
  • Catonsville, MD
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Lender Placed Insurance

Joe Stout
Pro Member
  • Investor
  • Catonsville, MD
Posted Feb 6 2024, 09:21

Hey all,

Long story short, there has been a massive flood in my house and I have lender placed insurance. I'm not able to obtain a copy of the insurance policy from the lender, the only thing they'll send shows a declaration page of the limit of coverage of $248,000. When speaking with the lender, they refuse sending anything else and claim that the coverage only covers the outside of the house (the roof is an example I was given). When I ask for something in writing they are unable to provide this claim. However, our flood is mostly interior damage as you can imagine. With my house only being worth $220,000 fixed up, a $180,000 loan, and about $90,000 renovation costs we are stuck in a bad position. 

Has anyone else run into making a claim on their lender placed insurance? Were you covered under your lender placed insurance for interior damage?

A fellow investor friend of mine pointed out that $248,000 is an extremely high limit to only cover the outside of a house and thinks it's nonsense.

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John Mocker#1 Insurance Contributor
  • Insurance Agent
  • Norwalk, CT
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John Mocker#1 Insurance Contributor
  • Insurance Agent
  • Norwalk, CT
Replied Feb 6 2024, 10:45

Joe,

Lender placed insurance generally protects their interest in the property.  Their interest is in the Building.  That may be what they mean by the "outside of the house".   If the interior damage is to the Contents, the policy may not include coverage for things that are not permanently attached to the building.

If you have the Declaration page, it should show the Insurance Company.  You could try contacting them directly.  The Declarations should show the policy number and the effective dates.  It may be a "Blanket" policy that does not cover a specific address but rather all addresses that fit a certain condition (no coverage, lapse, etc....).   

User Stats

74
Posts
36
Votes
Joe Stout
Pro Member
  • Investor
  • Catonsville, MD
36
Votes |
74
Posts
Joe Stout
Pro Member
  • Investor
  • Catonsville, MD
Replied Feb 6 2024, 14:59

@John Mocker, thanks for the insight, this aligns with most of what they said. But when asking for the terms of the policy I'm unable to obtain anything and sent a 10 page document including a declarations page. The insurance company says they are not allowed to send me anything and that I need to go through the lender. 

The interior to the house is completely tarnished, so cabinets, walls, ceilings, stairs, flooring, paint, appliances, etc. are all trashed. I'm trying to find out if that is covered or not.

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