March 14 California's insurance regulator
ordered 10 of the largest forced-place insurers in the state to
reduce their rates on their policies on Wednesday, saying the
rates charged were excessive.
California's clamp-down follows moves made by other
regulators to rein in forced-place insurance -
controversial policies that are purchased by the bank or
mortgage servicer on the homeowners' behalf.
For many homeowners who are required to buy insurance as a
condition of getting or keeping a mortgage, there is no choice
of insurer, terms or price.
An examination of the insurers' financial statements showed
low loss ratios, indicating the rates may be far too high,
California's Department of Insurance said in a statement.
Last week, Fannie Mae, the biggest source of money
for U.S. home loans, said it would seek to oversee such policies
and New York State's Department of Financial Services is said to
be probing several large banks, including Bank of America
and Citigroup, to see if they overcharged
customers for the policies.