Judge Approves Wells Fargo Force-Placed Insurance Settlement

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A judge has issued final approval for a settlement that will see Wells Fargo pay $300 million to resolve allegations in a force-placed insurance class action lawsuit.

The plaintiffs alleged that Wells Fargo entered into agreements with its insurer Assurant that artificially raised the prices of hazard policies for their homes. When they signed their mortgage agreements, homeowners agreed that if they did not maintain insurance for fire, flood or whatever other was required by the contract, Wells Fargo would be be able to buy one themselves in order to protect their collateral in the form of the property.

However, according to the Wells Fargo class action lawsuit, the lender and Assurant engaged in practices that may have resulted in high premiums for homeowners. Other companies have been the target of allegations that they also back-dated insurance coverage, meaning that they bought coverage after the fact even though no protection was necessary. All of the cases regarding force-placed insurance came as a result of a business media report in 2012 that cast light on the practice.

As a result of the final approval, the $300 million will help repay up to 11 percent of a homeowners’ insurance premiums for hazard, flood, flood gap or wind-only policies. It will affect roughly 1.2 million people who obtained a home loan from Wells Fargo. U.S. District Judge Federico A. Moreno also approved the force-placed insurance class action settlement in spite of the fact that there were 12 objections submitted by 21 Class Members.

Judge Moreno decided that requiring homeowners to submit a claim form was not an undue burden and is used often in resolving class action lawsuits because it represents a relatively low bar, but does require Class Members to submit some form of documentation. For residents of 40 states, their claims must resolve around paying force-placed insurance after Jan. 1, 2008, while at the other end of the spectrum, Ohio borrowers can file claims from Aug. 8, 1998.

It is not too late to file a claim for the Wells Fargo class action settlement! For more information, click here or visit www.FladellSettlementInfo.com.

The plaintiffs are represented by class action attorneys from Kozyak Tropin & Throckmorton PA, Podhurst Orseck PA and 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.