The following article is brought to you by Brian Bandell at BizJournals.Com
JPMorgan Chase & Co. and Assurant reached a $300 million settlement in a federal class action lawsuit in Miami over allegedly overcharging homeowners for forced placed insurance.
The class action was filed in June 2012 on behalf of borrowers with forced place insurance policies as of June 2008. The law firms representing the plaintiffs are Kozyak Tropin & Throckmorton, P.A., Podhurst Orseck, P.A., and Harke Clasby & Bushman LLP. They will share attorney fees and expenses paid by the defendants of no more than $20 million.
Force placed insurance is ordered for homes by lenders when borrowers decline to purchase insurance themselves. In many cases, the borrower is in default on the loan as well.
The attorneys say they have been investigating Chase and Assurant since 2010 and allege they were enriched by more than $1 billion over five years. Under the settlement, Chase and Assurant would pay 12.5 percent cash refunds to class members who paid the premiums of the force placed insurance and a 12.5 percent credit to class members who were charged the premiums but never paid them. This applies even if the borrowers already lost their homes.
Chase also agreed to no longer allow its insurance agents to collect commissions from making force-placed insurance policies.
Chase was represented in the lawsuit by Morgan Lewis & Bockius while Assurant was represented by Jorden Burt LLP.
The settlement is pending approval before Chief Judge Federico Moreno.
(CHASEHOMEFINANCESUX RESPONSE: How Many Times Do These Big Banks Get To Say, “OK, We Won’t Do It Again”, Before These Criminals Start Going To Jail?!)