$19.5M Settlement Reached in Wells Fargo and QBE Force-Placed Insurance Class Action Lawsuit

Miami, FL: A $19.5 million settlement has been reached in a force-placed insurance class action pending against Wells Fargo Bank and QBE Insurance. The lawsuit alleged that Florida homeowners were overcharged for the insurance, and that Wells Fargo unfairly took commission on the insurance, which it assigned to the homeowners through QBE.

Force-placed insurance is frequently assigned by lenders when property owners decline to buy coverage themselves, often when the loan is in default.

The class was certified in 2012, and more than 24,000 homeowners were notified. During the class period, from April 2006 to February 2013, the class members were charged $77 million for force-placed insurance, according to the settlement documents, the South Florida Business Journal reports.

Scheduled to go to court in July, the class action settlement was just reached and will provide a refund of the amount charged for forced-placed insurance to the members of the class.

Borrowers who were charged and paid the premium will be refunded 25 percent in cash. Those who were charged the premium but didn't pay will get a credit of 25 percent off their bill.

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Published on May-17-13