What is force-placed home insurance?

I know there are different types of home insurance and different coverage levels, but I've never heard of force-placed insurance. What is it?

Answer
If you have a mortgage, the lender requires you to carry home insurance. If you allow your home insurance to lapse or expire without getting a new policy on your own, the mortgage company or bank will force you to buy home insurance through them. This is commonly known as force-placed insurance.
Force-placed insurance will only cover the amount that you owe to the creditor; it will not cover your personal property or liability. In addition, this type of insurance can be very expensive and make your mortgage payments increase because the cost is included in your mortgage payments. Force-placed insurance is not ideal and you should definitely avoid this type of coverage.
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Jackie Whalen
Answered on Mar 12, 2021
Jackie Whalen has been in the insurance industry for over 7 years, working in sales, service and claims. She has won numerous awards as a top salesperson and customer service agent. She currently lives in New York with her husband. Her 24 year old son recently moved out on his own which has given her more time to travel, write and train her dog Maisy not to chase her cat, Whiskey.
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