QBE to pay $10M over force-placed insurance

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Associated Press

Posted on April 18, 2013 at 11:01 AM

Updated Thursday, Apr 18 at 11:03 AM

ALBANY, N.Y. (AP) — New York regulators have reached a settlement requiring QBE to pay a $10 million penalty and reform practices when insuring troubled mortgage loans.

The Department of Financial Services says the agreement signed Thursday also calls for restitution to homeowners hurt by force-placed insurance, which lenders obtain when the homeowners fail to maintain coverage required by the mortgage, often because they are in financial trouble.

It follows a similar settlement last month by Assurant Inc.

The department says the two companies are responsible for at least 90 percent of that coverage in New York and this should result in far lower premiums.

Sydney, Australia-based QBE did not immediately respond to requests for comment.

The investigation found far higher premiums charged to homeowners for less protection than in voluntary insurance policies.

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