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Wells Fargo Bank NA and Assurant Inc. have agreed to settle a class action lawsuit over the companies’ force-placed insurance practices, less than a week after a Florida federal judge approved a $300 million class action settlement over JPMorgan Chase NA’s similar practices.
“The parties to this action have negotiated an extraordinary settlement that provides significant monetary relief to Wells Fargo mortgagors nationwide who had insurance coverage ‘force-placed’ on their properties by [Wells Fargo], as well as injunctive relief that would effectively end the lender-placed insurance (LPI) practices at issue here,” the plaintiffs wrote in their motion for preliminary approval of the Wells Fargo class action settlement.
LPI is utilized by banks when homeowners fail to purchase or maintain property insurance. The banks can “force-place” an insurance policy to ensure the property has adequate insurance coverage. However, many homeowners have argued that the banks force-place insurance policies that are overpriced. They also complain that the banks often get kickbacks from these force-placed insurance policies.
The plaintiffs in the Wells Fargo force-placed insurance class action lawsuit did not dispute the bank’s contractual right to force-place insurance policies when a homeowner’s policy lapsed. What they took issue with was the alleged relationship with Assurant that allowed Wells Fargo to “artificially inflate borrowers’ premiums with costs well beyond the cost of coverage.” Some of the costs were allegedly used to provide kickbacks to Wells Fargo affiliates.
Plaintiff Ira Marc Fladell initially filed the Wells Fargo class action lawsuit in June 2012. Following a court order, the parties participated in formal mediation beginning in November 2013. The class action settlement was reached on Feb. 3, 2014.
Under the terms of the Wells Fargo force-placed insurance settlement, the defendants have agreed to repay homeowners up to 11 percent of the premiums they paid. The proposed Settlement Class includes all borrowers in the United States who were charged by Wells Fargo under a hazard, flood, flood gap or wind-only LPI policy for residential policy since at least Jan. 1, 2008. The Class Period may be longer for homeowners with properties in California, Florida, Illinois, Indiana, Louisiana, New Jersey, New York, Ohio, Pennsylvania or Texas.
The class action settlement enjoins Wells Fargo and Assurant from continuing to inflate the costs of force-placed insurance for five years, and requires Wells Fargo to establish hazard LPI at the last known coverage amount and ensure that the coverage is related to the value of the interest being protected.
Last month, Citigroup Inc. agreed to pay $110 million to settle a similar force-placed insurance class action lawsuit.
The plaintiffs are represented by Adam M. Moskowitz, Harley S. Tropin, Tucker Ronzetti, Rachel Sullivan and Robert J. Neary of Kozyak Tropin & Throckmorton PA; Aaron S. Podhurst and Peter Prieto of Podhurst Orseck PA and Lance A. Harke, Sarah Engel and Howard M. Bushman of Hark Clasby & Bushman LLP.
The Wells Fargo Force-Placed Insurance Class Action Lawsuit is Fladell, et al. v. Wells Fargo Bank NA, et al., Case No. 0:13-cv-60721, in the U.S. District Court for the Southern District of Florida.
UPDATE: Instructions on how to file a claim for the Wells Fargo force-placed insurance settlement are available! Click here or visit www.FladellSettlementInfo.com for more information.
UPDATE 2: The Wells Fargo force-placed insurance class action settlement received final approval on Oct. 29, 2014.
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48 thoughts onWells Fargo Agrees to Force-Placed Insurance Class Action Settlement
http://topclassactions.com/lawsuit-settlements/closed-settlements/35987-wells-fargo-force-placed-insurance-class-action-settlement/ Read the comments in this link, Maybe it will bring you up to date.
Has anyone found any information on this lawsuit?
Why are documents are still being filed in the case as of 8/6/2015? When will it end?
My husband and I received and submitted 8 of these claim forms. I see where the lawsuit has been approved. Could someone ease advise the latest status of this lawsuit? How do we know our claims where approved? When do you expect to pay this money out? An update would be great.
I’ve presented x2 forms and has been trying to keep up with the dates but, all.I’ve found was the case has approved and that the case has been closed. I’ve tried calling but all you get is a recording. I’ve asked when will there be reimbursements, no reponse, no letter or anything. If anyone get any information please e_mail me and I will do the same. Thanks, EK
I would like to know how will members be notified that thier participation in this suit have been approved and how and when will they know they have been reimbursed.
Thanks