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What Happens When Your Homeowner’s Insurance Coverage Lapses?

Having a current and valid homeowner's insurance policy on your home is important. If you are still paying a mortgage on that home, you may face serious consequences if your coverage lapses. It is important to maintain your homeowner's insurance coverage in order to protect yourself from financial losses and damages.

If your house is already paid off and your homeowner's insurance policy lapses, you will no longer have coverage for your home and belongings. This means if your home catches on fire or you sustain flood damage, you cannot file a claim.

If there is a mortgage on your home, your homeowner's insurance provider will notify your lender once your policy has lapsed. At this time, your bank may put a forced place insurance policy on your property, which will be charged to you. Unfortunately, this type of insurance policy only protects the bank; you are not covered in the event of damages, flood, or robbery.

By allowing your homeowner's insurance coverage to lapse, you will be placed into a "high-risk" category. This can make it more difficult to find an affordable homeowner's policy. You may also be denied coverage by carriers with preferred rates.

If your homeowner's policy lapses, it is important to obtain new coverage within 30 days to avoid the above consequences.

Browse our library to learn more about homeowner's insurance policy lapses. 

If your lender recently placed a forced place insurance policy on your home after a lapse in your homeowner's policy, you should speak with an experienced Massachusetts consumer rights attorney. A class action case may cause the lender to stop their deceptive insurance practices and may allow you to receive compensation for your monetary losses. Contact the Massachusetts class action lawyers at Phillips & Garcia today to schedule your FREE legal consultation - (877) 892-5620.