New Product Alert: Mortgageholders Coverage Program (MCP)
News From the Vault
July 16, 2020

Economic risks and exposures associated with mortgage portfolios have become more complex; so has protecting banks from losses. As a response to this, OneBeacon Financial Services has created a new policy to account for different types of losses that could impair mortgages, as well as certain exposures from originating and servicing loans.

Some questions to keep in mind when reviewing your borrower’s insurance policies:

  1. Is the insurance covered by an escrow account you control? Make sure you have documentation that the insurance is in force. Mistakes have been made when lenders assume an installment payment covered the whole year.
  2. If you don’t escrow money for the insurance, do you have evidence of insurance in hand? When does it expire? Is it still in force?
  3. Be proactive – if a mortgage is delinquent, contact the insurance agent and make sure coverage is in force. Give the agent your contact information should anything come up.

Being proactive helps, but there’s always the possibility of an oversight

Insurance could lapse without your knowledge, and an endorsement approach may no longer be the best solution for protection. The benefit of OneBeacon’s Mortgageholders Coverage Program is that there are over fifteen different insuring agreements available, with ample room for flexibility for a customized solution that meets your needs. Here are just a few of the coverage highlights:

  • No vacancy provision
  • No hard and fast warranty
  • Admitted coverage
  • Mortgageholder’s Liability is written on an occurrence basis with defense outside
  • Multiple options for Balance of Perils
  • Post termination coverage extends liability coverage for up to a year after mortgage satisfaction

Take this time to review and upgrade your protection. To learn more about MCP, contact Betsy Good at egood@onebeacon.com or 781.332.8357.

This article is provided for general informational purposes only and does not constitute and is not intended to take the place of legal or risk management advice. Readers should consult their own counsel or other representatives for any such advice. Any and all third-party websites or sources referred to herein are for informational purposes only and are not affiliated with or endorsed by Intact Insurance Group USA LLC (“Intact”). Intact hereby disclaims any and all liability arising out of the information contained herein.