Fire Insurance Tied to Mortgage...

[DSM]

Hi Everyone:

As you can tell, I'm a bit new here, but I could use the assistance of some good P & C guys and gals...

I'm a 17 year L & H producer.

What exactly is the Fire Insurance that is tied to the purchase of a new home. I know it's separate from homeowners insurance.

-What is it exactly?
-When and how is it required in regards to the mortgage note closing?
-What is the commission payout first year and renewal years?

THANKS EVERYONE!

 

[BigIVU]

The property insurance component of a homeowners insurance policy usually includes the peril of fire, so I'm not aware of their being any separate need. Most lenders will want proof of insurance at the time of closing, either the policy or a binder. Commission rates on new business and renewals varies and probably averages about 12%...the practicing agents here could provide more detail. That's the amount paid to the agency, not the producer of the business.

 

[agent m]

Are you talking about new home purchase or like a home being constructed with a changing value of property while the home becomes progressively more complete.

 

[BigIVU]

Either. Under ISO eligibility rules, you can place a homeowners policy on a home under construction. Or you can get a builders risk property policy and extend the liability coverage to the home under construction. Our buy CGL coverage. Maybe workers compensation. It depends on the situation. Are you hiring a general contractor who is responsible for the insurance? Are you acting as your own GC? Etc. A builders risk policy is usually a commercial insurance form but it can be written on perils comparable to that on a homeowners form. I don't know why anyone would insure only the peril of fire when there are other causes of loss as or more likely.

 

[DSM]

I'm talking about a post escrow, pre-close fire policy that the lender requires before the actual move-in into the home. Any help?
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Is it possibly called Hazard Insurance?

And if so, can someone help me with my questions at the top of the thread?

 

[VolAgent]

Did you get homeowner's insurance for the house? It sounds like a force-placed policy because you didn't get your own coverage. Make sure they have the certificate for your policy.