12 CFR §1024.37 — Force-placed insurance
Regulation X §1024.37 sets requirements before [LENDER] may assess a borrower for force-placed hazard insurance: reasonable basis, 45-day initial notice, 15-day reminder notice (delivered no sooner than 30 days after the initial notice), 45-day renewal notice, mandatory cancellation and refund within 15 days of evidence of borrower coverage, bona-fide-and-reasonable charge limitation.
Verbatim regulatory text
Verbatim provisions from 12 CFR §1024.37 — Force-placed insurance — each quote is a verified substring of the regulator-published source snapshot, not retyped. Quoted for reference; this is not legal advice. The operational layer (P&P updates, prompts) lives in the regulation update kits.
12 CFR §1024.37(b) — Reasonable basis required to charge for force-placed insurance
(b) Basis for charging borrower for force-placed insurance. A servicer may not assess on a borrower a premium charge or fee related to force-placed insurance unless the servicer has a reasonable basis to believe that the borrower has failed to comply with the mortgage loan contract's requirement to maintain hazard insurance .
12 CFR §1024.37(c)(1) — Initial 45-day notice + 15-day reminder before charging
(c) Requirements before charging borrower for force-placed insurance —(1) In general. Before a servicer assesses on a borrower any premium charge or fee related to force-placed insurance, the servicer must:
12 CFR §1024.37(d)(1) — Reminder notice: 15-day pre-charge, 30-day post-initial-notice
(d) Reminder notice —(1) In general. The notice required by paragraph (c)(1)(ii) of this section shall be delivered to the borrower or placed in the mail at least 15 days before a servicer assesses on a borrower a premium charge or fee related to force-placed insurance. A servicer may not deliver to a borrower or place in the mail the notice required by paragraph (c)(1)(ii) of this section until at least 30 days after delivering to the borrower or placing in the mail the written notice required by paragraph (c)(1)(i) of this section.
12 CFR §1024.37(e)(1) — 45-day notice before renewing or replacing force-placed insurance
(e) Renewing or replacing force-placed insurance —(1) In general. Before a servicer assesses on a borrower a premium charge or fee related to renewing or replacing existing force-placed insurance, a servicer must:
12 CFR §1024.37(g) — Cancel and refund force-placed insurance within 15 days of coverage evidence
(g) Cancellation of force-placed insurance. Within 15 days of receiving, from the borrower or otherwise, evidence demonstrating that the borrower has had in place hazard insurance coverage that complies with the loan contract's requirements to maintain hazard insurance , a servicer must:
12 CFR §1024.37(h)(1) — Force-placed-insurance charges must be bona fide and reasonable
(h) Limitations on force-placed insurance charges —(1) In general. Except for charges subject to State regulation as the business of insurance and charges authorized by the Flood Disaster Protection Act of 1973 , all charges related to force-placed insurance assessed to a borrower by or through the servicer must be bona fide and reasonable.
12 CFR §1024.37(c)(1) — Initial 45-day notice + 15-day reminder before charging — enumerated items (chapeau recall fix)
(i) Deliver to a borrower or place in the mail a written notice containing the information required by paragraph (c)(2) of this section at least 45 days before a servicer assesses on a borrower such charge or fee; (ii) Deliver to the borrower or place in the mail a written notice in accordance with paragraph (d)(1) of this section; and (iii) By the end of the 15-day period beginning on the date the written notice described in paragraph (c)(1)(ii) of this section was delivered to the borrower or placed in the mail, not have received, from the borrower or otherwise, evidence demonstrating that the borrower has had in place, continuously, hazard insurance coverage that complies with the loan contract's requirements to maintain hazard insurance .
12 CFR §1024.37(e)(1) — 45-day notice before renewing or replacing force-placed insurance — enumerated items (chapeau recall fix)
(i) Deliver to the borrower or place in the mail a written notice containing the information set forth in paragraph (e)(2) of this section at least 45 days before assessing on a borrower such charge or fee; and (ii) By the end of the 45-day period beginning on the date the written notice required by paragraph (e)(1)(i) of this section was delivered to the borrower or placed in the mail, not have received, from the borrower or otherwise, evidence demonstrating that the borrower has purchased hazard insurance coverage that complies with the loan contract's requirements to maintain hazard insurance . (iii) Charging a borrower before end of notice period. Notwithstanding paragraphs (e)(1)(i) and (ii) of this section, if not prohibited by State or other applicable law, if a servicer has renewed or replaced existing force-placed insurance and receives evidence demonstrating that the borrower lacked insurance coverage for some period of time following the expiration of the existing force-placed insurance (including during the notice period prescribed by paragraph (e)(1) of this section), the servicer may, promptly upon receiving such evidence, assess on the borrower a premium charge or fee related to renewing or replacing existing force-placed insurance for that period of time.
12 CFR §1024.37(g) — Cancel and refund force-placed insurance within 15 days of coverage evidence — enumerated items (chapeau recall fix)
(1) Cancel the force-placed insurance the servicer purchased to insure the borrower's property; and (2) Refund to such borrower all force-placed insurance premium charges and related fees paid by such borrower for any period of overlapping insurance coverage and remove from the borrower's account all force-placed insurance charges and related fees for such period that the servicer has assessed to the borrower.