Foreclosed Property owned by lenders (REO) or investors in REO properties may also be covered by the same L&A Lender Placed policy used in Force Place. This provides a guaranteed, easy-to-manage system of covering Foreclosed/REO properties. Rates are lower on Foreclosed Property, thus minimizing insurance costs while providing the broadest coverage under a master policy with no individual underwriting of specific properties. L&A also offers General Liability as well as Property Coverage for foreclosed properties.
Extremely broad coverages in L&A’s proprietary Lender Placed policy furnish a checklist for industry comparisons.
- General Liability insurance for foreclosed properties
- Wind and Hail coverage in all coastal areas
- Builders Risk is available for partially completed structures
- Condominium coverage
- Flood and Earthquake (excluding California Earthquake)
Force Placed Flood endorsements with minimum deductibles may be substituted for the standard.
Standout features of L&A’s proprietary lender placed policy
- No coinsurance requirement: While traditional insurance requires the property to be insured to at least 80% of its replacement cost, this is not feasible on a Force Placed/Foreclosed Property Policy, as many banks, other lenders and REO investors place coverage on the outstanding loan balance or original cost of the property. The resulting coverage amount is often substantially lower than its replacement cost. Waiving this percentage of-replacement-cost or coinsurance eliminates penalties that would otherwise be assessed in claims settlements.
- Reporting system: The Web-based reporting procedure for the L&A program is user-friendly and tailored to the needs of financial institutions.
- Coverage to term: Once a property is entered into the L&A system, it remains there until coverage is modified or cancelled. This relieves our policy holders from constant monitoring and periodic re-entry of a property to maintain continuous coverage.
- Coverage charge for actual term: Premiums under the L&A program are calculated on the exact time coverage remains in effect. If coverage is cancelled mid-month you are only charged for the number of days coverage was in force. There is no full-month minimum for coverage in a “part thereof.”