13 Jul A Few Important Facts About Force Placed Insurance
A Few Important Facts About Force Placed Insurance
The necessity of having complete property or home insurance coverage is no secret. However, what happens when a resident stops paying their homeowners insurance, or if the lender doesn’t believe the coverage is sufficient? This is where force placed insurance comes into the picture. This type of insurance guarantees the property is fully protected, no matter if someone is living in it or if it’s currently vacant. As it deals with the industry and business of managing multiple properties, here are a few important factors to know.
Force Placed Insurance Protects Property Owners
Anyone who manages properties should view any type of insurance option as a safety net in the event of a disaster. Every property must have insurance. If homeowners insurance was canceled or payment was halted for any reason, the lender could add a certain dollar amount to the insurance premium to ensure there will be sufficient coverage on the property. The premiums will likely be significantly higher than a typical policy, but property management owners can have some peace of mind knowing their property will always be covered.
Ensures Proper Coverage
Another reason force placed insurance can be beneficial is if there’s not enough coverage on the property. Insurance companies may determine the home’s value is worth more than the coverage, and insist on alternative insurance options to ensure proper coverage. Many property insurance companies will do frequent inspections of the property to determine whether coverage is sufficient at any given time.
No matter the reason why a property is vacant, there are insurance alternatives that can protect it during the transition period. This is crucial if the property is going through foreclosure or a short sale when it will typically remain vacant for several months. Having adequate property insurance during this time can protect the value of the property, so having the right insurance policy in place will ensure the value remains intact.
Possibly the most important property management decision you can make is finding a reputable insurance company that enforces the proper amount of insurance. This insurance is invaluable because it protects you in the event of a disaster, and APIA wants to help you even when you may not have sufficient coverage. We are flexible with our force placed insurance policies to ensure coverage without emptying your bank account. Be sure to contact us to learn more about our various insurance policies to meet your specific needs.