Protecting the collateral in a mortgage servicer’s portfolio through verification of adequate fire, flood and wind insurance is a requirement of investors and federal regulators. It is a complex process to consistently verify that the appropriate insurance is in place on the dwelling, paid timely and meets the requirements of the servicers as well as the GSEs. That’s why most servicers outsource the responsibility to an insurance tracking provider (“provider”) who has the infrastructure, technology and expertise to perform the work more effectively and stay compliant.
Servicers should ensure that their provider utilizes an insurance tracking approach consisting of comprehensive and proactive loan monitoring, customer education and notification, and a breadth of insurance products to ensure the servicer’s interest, as well as that of the customer, is protected.
Publisher: National General Lender Services
Date: April 2018