Originally Published - Oct 03, 2012
We started a LinkedIn group last week named Banking & Force-Placed Insurance. The group was started to begin to share some of the compliance information regarding the guidance and litigation around force-placed insurance. As well, it will be a place where we can begin to share some of our concepts on Borrower-Centric Insurance Tracking.
LinkedIn allows you to send an invitation to 50 of your contacts at a time, so I started sending invitations out to my contacts. It wasn't more than a few hours and I saw that I had 4 comments that were waiting approval for the group. I was excited to see these comments and was ready to get the group going. To my surprise, the four comments ended up being a dissertation from an individual who was an ex-employee of both an insurance tracking company and a large bank.
This person, a self proclaimed expert on force-placed insurance, went on and on about the injustice of force-placed insurance. If he wasn't so irrational, I would have engaged him in the debate. I chose not to…
If you spend as much time as I do reading class action lawsuits, regulatory guidance, and comments around the web on force-placed insurance, you know the very negative attitudes from borrowers who have been force-placed by some of the fee-income producing tracking operations. We as an industry have a long way to go to clean up our reputation. We have been painted with a very broad brush, and unfortunately 7,000+ banks out of the 7,204 federally insured banks are going to have to wrongfully wear this paint for some time.