SWITCHING HOME INSURANCE

If Escrowed and Switching with New Home Loan:

Your new lender will require information regarding your homeowner's insurance. Tell them you are switching companies and give them our contact information. We will send your new lender all the information they will need to get your loan approved and through underwriting. At closing, the lender will collect funds to pay for your initial annual premium. They will also collect money each month in escrow to pay your premium each year at renewal.

If Escrowed and Switching at Renewal, outside of a loan transaction:

This one is easy. Contact your lender 30-60 days in advance of your policy renewing and tell them not to pay the renewal for the “old” insurer. Once the remaining steps (outlined below) are completed, you simply call your lender back and authorize the payment to the new insurer once the policy is prepared and they are invoiced.

Make sure to call your “old” home insurance company and officially cancel their policy, effective on the renewal date. Of course, if your lender doesn’t make a payment to them; your “old” policy will cancel for non-payment.

If Escrowed and Switching Mid-Term, outside of a loan transaction:

Contact your lender or loan servicing company to determine if they will simply make the new payment for you and wait for a refund from the prior insurer. Typically, larger banks that service their own loans (Bank of America or Wells Fargo) will “float” the new payment for you and wait for the refund to re-balance your escrow account. Once you get the refund from your prior insurance company, you will need to send those funds back to your lender to re-balance your escrow account.

You may have to make the payment yourself and wait for your own refund if your mortgage is serviced by a different company than the one who actually carries your note. Either way, a payment is made to the new insurer and the refund from the “old” insurance company replaces the outlaid funds.

If you have to layout the money personally, you may simply pay on a credit card and apply your premium refund to the next credit card payment…just be sure to ask your previous insurer how long it takes them to cut a refund check and time it accordingly.