What is our recourse if our homeowner’s insurance policy was falsified by the insurance agent?

UPDATED: Oct 1, 2022

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What is our recourse if our homeowner’s insurance policy was falsified by the insurance agent?

We obtained and closed on a home loan about 2 months ago. We signed for a loan that included our insurance and property taxes in the monthly mortgage payment and left the rest to the mortgage broker and insurance agent. We got an email from our insurance agent stating that we need to pay over $500 today and $184 a month for our insurance premiums in order to not be dropped from our policy. After much back and forth with him and our mortgage broker, we found out that our premiums were not paid for this year through our escrow account because the insurance agent had marked our premiums as paid in full on the paperwork required to obtain our loan. He says that he did this at the request of the mortgage broker. The broker says that we are being misled

by the agent. We are required by our lender to have insurance on our property at all times, so letting it lapse is not an option but paying hefty premiums on

top of our mortgage when the mistake was not ours and documents were falsified without our knowledge. We are unsure how to move forward.

Asked on May 25, 2018 under Real Estate Law, California


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 4 years ago | Contributor

If you suffer any losses due to someone else's (like the insurance agent or broker) negligent (careless) or intentionally wrongful act, you can sue the at-fault person(s) to recover your loss. So if money was taken from you without being used to pay for insurance, you can sue to get that money back. If you can show that you end up paying more for insurance now because of how you had to buy it than you should have, you can potentially recover that additional cost. Etc. So once you identify the costs or losses you have incurred, you can sue anyone who may be liable for your loss to recover compensation.

IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although AttorneyPages.com has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

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