FAQs

What is lender-placed insurance?

Lender-placed insurance (also known as “force-placed” insurance) is a policy Pennymac is required to purchase for your property if your own homeowners, flood, or hazard insurance coverage lapses or is canceled.

Because continuous insurance is a requirement of your mortgage, we must put this coverage in place to protect the property until you provide proof of a new personal policy.

Important facts about lender-placed insurance:

  • Higher Cost: These policies are typically significantly more expensive than insurance you would purchase on your own.
  • Limited Coverage: This coverage is designed to protect the physical structure of the home. It generally does not cover your personal belongings, nor does it provide personal liability protection for you.
  • Payment Impact: The cost of this premium will be added to your monthly mortgage payment, which could lead to an escrow shortage.

How to remove lender-placed insurance:

If you have already secured a new policy, please send us your Declarations Page immediately. Once we verify your new coverage, we will:

  1. Cancel the lender-placed policy.
  2. Refund any “overlapping” premiums for periods where you were double-covered or had your own policy active.

Where to send proof of insurance: