Common Questions About Insurance


If my homeowner's insurance premium has already been paid from escrow and I change insurance companies, will my lender pay for the new insurance?

My lender recently sent me a letter stating that I need flood insurance, why?

I am required to have flood insurance, but I have lived in my house for years and have never been flooded. Is there anyway I can remove my house from being in a flood zone?

How do I go about filing a LOMA/LOMR?

If my house is on a hill (above the base flood level), does this mean flood insurance is not required?

How much coverage do I need for flood insurance?

I have proof I am not in a required flood zone. What can I do?

I have heard the term "Insurance Loss Draft Check." What does this mean?

For a loss draft check, what is needed to have the check returned back to the homeowner?

 
If my homeowner's insurance premium has already been paid from escrow and I change insurance companies, will my lender pay for the new insurance?
Typically they will only make one disbursement from escrow for insurance per year. You will be responsible to cancel your previous insurance policy, obtain any refund due to you and then pay your new carrier. If the refund is sent to the lender usually they will deposit it into your escrow account.

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I recently received a letter stating that I need flood insurance, why?
Lender's Federal Mapping Company made a flood zone determination based on the Flood Insurance Rate Map (FIRM) published by Federal Emergency Management Agency (FEMA) for your community and has indicated the property now lies on a flood plain.

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I am required to have flood insurance, but I have lived in my house for years and have never been flooded. Is there anyway I can remove my house from being in a flood zone?
Your house may be above the base flood elevation (flooding level) in which case you may want to file a Letter Of Map Amendment or Revision (LOMA/LOMR). If this is approved by Federal Emergency Management Agency (FEMA), you may not be required to maintain flood insurance or your premium may be reduced.

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How do I go about filing a LOMA/LOMR?
Contact your city hall, tax assessor or zoning and planning office. Or you may contact FEMA at 800-638-6620.

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If my house is on a hill (above the base flood level), does this mean flood insurance is not required?
No. Regardless of the elevation of your property, if your dwelling is in an "A" or "V" zone, flood insurance is required. However, elevation information can be used to get a lower flood premium and/or to file a Letter Of Map Amendment or Revision (LOMA/LOMR). While the LOMA/LOMR is being reviewed by FEMA, flood insurance is still required.

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How much coverage do I need for flood insurance?
You are required to have coverage for at least 80% of the replacement cost of your house or the loan balance, whichever is LESS.

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I have proof I am not in a required flood zone. What can I do?
Fax any documentation (survey, LOMA/LOMR, revised map) to ATTN: Flood Insurance Department at 856-917-8301 or mail it to Mortgage Service Center, Attn Insurance Dept. P.O. Box 5453, Mt Laurel, NJ 08054. We will have our mapping company review it. You will receive written notification of the outcome of our research.

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I have heard the term "Insurance Loss Draft Check." What does this mean?
In case of a natural disaster (Fire, hurricane, etc), the insurance company will inspect a homeowner’s property and issue a check to the homeowner to replace the damage. This check is made co-payable to the homeowner and us. We must always be notified when this loss occurs.

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For a loss draft check, what is needed to have the check returned back to the homeowner?
Since all loss draft checks are made co-payable to the homeowner and the lender, it must be sent to the lender for endorsement. You will need to contact your lender and make arrangements for them to endorse the payment and return it to you.

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On loss drafts checks, can we remove the mortgage company name from the check?
No, the lender must be listed on all loss draft checks.

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