Back in April 2014, Law360 reported that Bank of America, N.A. (“BOA”) agreed to pay $228 million to plaintiff homeowners in order to settle a putative class action brought against the bank. The settlement came after a hard fought battle between plaintiffs’ counsel and BOA’s counsel.
The class action was filed in the U.S. District Court for the Southern District of Florida, a federal court located in Miami-Dade County, on behalf of homeowners alleging that BOA forced them to accept and pay for overpriced insurance from QBE/Balboa Insurance Company after their original property insurance lapsed. According to their motion, the homeowners’ counsel argued that this “forced-placed” insurance requires homeowners to pay premiums for hazard insurance that is beyond what is reasonable or necessary to properly protect the property.
BOA is not alone in this practice. Several other major lenders, including JPMorgan Chase Bank, N.A., HSBC Bank USA, N.A., Citibank, N.A., and Wells Fargo, N.A. have agreed to high dollar settlements after facing similar accusations.
What does this mean for you?
The settlement agreement between BOA and the plaintiff homeowners provides for prospective relief that will prevent lenders from forcing homeowners to accept forced-place property insurance in the future. If you, a family member, or a friend has been forced by your mortgage lender to accept property insurance from an insurance company of the lender’s choice, contact us today for a free initial consultation.
Florida Insurance Guarantee Association (“FIGA”) is a legislatively created company charged with the handling of covered claims against insolvent property and casualty insurance companies. The deadline for the filing or pursuit of such claims is two years from the date of insolvency. Currently, FIGA deadlines are approaching for the handling of new or existing claims under policies issued by the two most recently dissolved, Florida licensed underwriters of property and casualty insurance, Frontier Insurance Company and ULLICO Casualty Company.
If you were issued a policy of property insurance by either Frontier Insurance Company or ULLICO Casualty Company, and experienced a loss to your property that occurred prior to the expiration of such policy, please contact us now for an immediate and free initial case evaluation.