Volume 2 Number 1
January 3, 2005










TEXT VERSION

 

 


GALLAGHER TO MORTGAGE HOLDERS: KNOW YOUR BANK’S PROCEDURE FOR PROCESSING INSURANCE CLAIM CHECKS

To assist Floridians who recently received claims settlement checks or who are expecting payments from insurance companies, Florida’s Chief Financial Officer Tom Gallagher is advising storm victims with mortgages to be aware of bank procedures for receiving insurance funds to make repairs. 

“If you have a mortgage, you will need to work closely with your lender to complete the repairs process.”  Gallagher said.  “Your bank may choose to release funds only as repairs are complete but should also remain focused on assisting you in restoring your home as quickly as possible.”

While policies may vary with individual financial institutions, insurance checks are usually made payable to both the homeowner and mortgage holder.  To receive funds, homeowners must forward claim checks to their lenders for endorsement.  For best security, a consumer should wait to endorse his or her check until after the lender has done so.  However, lenders may have additional procedures to follow.

The lender may require a contractor’s estimate of repair costs before any funds are released.  The lender may also retain insurance proceeds for disbursement as repairs are completed.  Your lender may be willing to release a portion of the proceeds if payments are required to begin repairs.  However, consumers are advised never to pay construction contractors, in cash or in full, before work begins. 

Gallagher first issued this advice in the aftermath of Hurricane Charley, but sought to reiterate the message after a recent increase in calls from consumers concerned about the repairs process and dealing with mortgage lenders.

For consumers who are cooperating with their lenders but continue to experience delays or difficulties completing the repairs process, Gallagher said insurance specialists are available to assist at
1-800-22-STORM.  

Consumers should also contact the Department of Financial Services if they are experiencing delays in dealing with adjusters or receiving claims settlement offers, or if they have a dispute with an insurance company over a settlement offer.