New York Announces Two Additional Lender-Placed Insurance Actions

more+
less-

On April 18, New York Governor Andrew Cuomo announced that the New York State Department of Financial Services obtained two additional separate settlement agreements, one with QBE Insurance Company and one with Balboa Insurance Company, stemming from a DFS investigation of the lender-placed insurance industry. Neither company admitted any wrongdoing in connection with their respective settlements. This follows the DFS’ announcement last month that it had reached an agreement with Assurant, pursuant to which the company agreed to pay a $14 million penalty. Like the Assurant settlement, the QBE agreement requires it to (i) re-file rates for lender-placed insurance, (ii) change its disclosures and notices to borrowers, and (iii) discontinue paying commissions to servicer affiliates in New York.  QBE agreed to a penalty of $4 million. Balboa, whose business was purchased by QBE in mid-2011 and is currently in run-off, agreed to a $6 million penalty.  In addition, borrowers may be entitled to partial premiums refunds if they (i) can prove they defaulted on their mortgage or were foreclosed upon because of lender placement, (ii) were charged for lender placement at a coverage amount higher than permitted by their mortgage, or (iii) were erroneously charged for lender-placed insurance when they had voluntary insurance in effect, or were charged commercial rates for a residence. BuckleySandler represented both QBE and Balboa in the investigation and its resolution.


DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© BuckleySandler LLP | Attorney Advertising

Written by:

more+
less-

BuckleySandler LLP on:

Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:

Sign up to create your digest using LinkedIn*

*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.
×
Loading...
×
×