servicerguide

Force-placed insurance

My servicer charged me for force-placed insurance. How do I fight it?

The short answer: force-placed insurance protects the lender, not you — and it's usually far more expensive than a normal homeowners policy, billed straight to your escrow. You fight it with proof: servicers must warn you in writing before charging, and when you show continuous coverage, they must cancel the policy and refund the charges.

What force-placed insurance actually is

Your loan requires you to carry homeowners insurance. If your servicer believes your coverage lapsed — a missed renewal, a canceled policy, a letter they claim they never received — they can buy "force-placed" (lender-placed) coverage and bill you for it. It covers the lender's interest in the property, often with worse terms than your own policy, at a premium that can be two or three times a normal policy.

Why it happens to people who had insurance

  • Your insurer sent the renewal proof to the wrong servicer address.
  • You switched insurers and the new company never notified the servicer.
  • Your policy renewed but with a different policy number, and the servicer's matching failed.
  • The servicer's insurance-tracking vendor made an error.

In other words: this is frequently a paperwork failure, not a coverage failure.

The fight, step by step

  1. Gather your proof. Declarations pages from your own insurer showing continuous coverage for the entire force-placed period. Get them from your agent or insurer directly — not from memory.
  2. Send the proof in writing to the servicer's insurance department (certified mail or the servicer's secure upload — keep the receipt). Ask for cancellation of the force-placed policy and a full refund of all premiums charged.
  3. Demand a corrected escrow analysis. Force-placed premiums inflate your escrow, which inflates your payment. Once refunded, the analysis must be re-run.
  4. Escalate if they stall. A formal written notice of error triggers the servicer's duty to investigate and respond — and a CFPB complaint gets attention →
Refunds are real and common When borrowers prove they had continuous coverage, servicers routinely cancel force-placed policies and refund the premiums. The key is written proof of coverage for the exact dates — verbal "I had insurance" doesn't move the file.
Don't let them double-insure you While you're fighting, make sure your own policy stays active. A genuine lapse lets them keep the force-placed policy — and gives them the one argument that actually holds up.

Related guides

Informational only — not legal or financial advice.

Mortgage rules vary by loan type, servicer, and state. Check your own loan documents and official federal resources, or talk to a licensed professional, before acting.