Nice arrangement of pink clematis.

For most of us, our house is our biggest and most valuable asset. It’s our shelter – our place to be safe and to call home. And for that reason, we want to keep it protected when disaster strikes. Homeowners insurance is a necessary way for us to keep our homes safe from the unpredictable.

A few things might cause you to change your homeowners insurance company.

First, you might switch homeowners insurance companies to save money. Shopping around for better policies is an important part of the process, and you should look for the best possible option.

The other common reason is that you want to increase or reduce your coverage in a way that cannot be done by your current homeowners insurance company. So, you begin the search for a company that can better meet your custom insurance needs.

Making the Switch

Whatever your reason is for switching, you’ll want to make this transition in the right way. Let’s take a moment, from the perspective of a Quicken Loans client, to go through the steps of changing your insurance carrier.

Step 1: Break Up with Your Carrier

If you decide to change insurance companies, you must let your old insurance carrier know that your policy needs to be cancelled. Don’t belabor this one – just rip it off like a bandage. Call your current insurer and break the bad news.

Step 2: Refund the Refund

If your old policy hasn’t ended when you cancel, you may receive a refund check from your now-previous carrier. Before you run to the mall and splurge on your wish list, take a few deep breaths and send that fully endorsed check to Quicken Loans.

Whoa, whoa, whoa! But that’s your refund! At a first glance, this can seem confusing. Let’s take a second to break down what’s really happening with this refund and how Quicken Loans is involved in the process.

When you get a mortgage with Quicken Loans, most clients have something called an escrow account. This is a savings account that’s set up by your mortgage lender. Quicken Loans, as a service to you, will pay your yearly homeowners insurance policy upfront. You’ll pay it back on a monthly basis as part of your regular mortgage payment. This way, your payments are more manageable.

But what does this have to do with your refund? Let’s say your yearly policy costs $1200. Quicken Loans pays that upfront, and you’ll pay in monthly increments of $100 as part of your escrow account. After three months (during which you paid $300 for homeowners insurance), you decide to change insurance companies, meaning you receive a refund from your previous carrier. Since you’ve only had the policy for three months, you will receive a refund for nine months of insurance payments ($900).

Step 3: Beware the Escrow Shortage

If you change homeowners insurance companies, Quicken Loans will again pay for your policy upfront. But if you didn’t send Quicken Loans the refunded check from your previous policy, you’ll need to pay for both the old policy and the new policy as part of your monthly mortgage payment.

This, in turn, could cause something called an escrow shortage, which basically means you don’t have enough money in your escrow account to pay for all of your insurance. This causes your monthly mortgage payment to increase the next time your annual escrow analysis is performed.

This is why sending your fully endorsed refund check to Quicken Loans, is usually easier. If you prefer, you can send a personal check for the amount of the refund you received instead.

Where Do I Send My Refund?

Once you’ve received your refund, you should send it to the following address:

Quicken Loans Inc. ISAOA
PO Box 202070
Florence, SC 29502

By doing this, you’ll be taking full advantage of your new policy and keeping your escrow account in check.

If you have questions about this policy or refund, or you’d like more information, feel free to reach out to Quicken Loans at (855) 282-8722, Monday – Friday, 7:00 a.m. – 8:00 p.m. ET. Looking for a new mortgage? Contact a Home Loan Expert today!

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This Post Has 12 Comments

  1. I filled out a refi application with a new lender but did not sign any additional papers and told the new lender that I was no longer interested. I then found out that the potential new lender had changed my home owners insurance to their company without my knowledge or permission. What are my rights?

    1. Hi Talesha:

      I honestly can’t say I’ve ever heard of anything like that happening. I can tell you that the mortgage lender doesn’t even need proof of homeowners insurance normally until you actually close the loan. I would contact an attorney about this and see if you have a case to get some restitution of some sort or even contact your attorney general. You could start by talking to the lender and seeing if they will work with you to make it right.

      Thanks,
      Kevin Graham

  2. I have switched HomeOwner insurance companies but have recently found that many neighbors are having roof replacements form a Hailstorm that occurred while under the previous insurer. Who do I file a claim with the prior insurance that was in effect at the date of the incident or the current insurer?

    1. Hi Vincent:

      You would have to file with the insurer that was in effect at the time of the hailstorm. You weren’t being covered by your current insurance at the time and that’s what they will tell you.

      Thanks,
      Kevin Graham

  3. If I knew this before hand I would not have cashed the refund check. Now, because of this my morgage payment is more than it was before we decided to refiance our morgage with Quicken Loans. I’m very disappointed. Plus, even after if we had the money to pay up front for the shortage our monthly payment still is higher than we need it to be.

    1. Hi Deborah:
      I’m sorry to hear you’ve had this experience. I’m going to have someone reach out to see if we can get this turned around.
      Thanks,
      Kevin Graham

  4. I sent a check to this address over a month ago and the check has not been cashed. Getting ready to stop payment. What’s up?

    1. Hi Mike:

      I know that we recently switched insurance providers ourselves for our loan servicing. That may have something to do with it. I’m going to have someone look into this and we can figure out what happened here so we’ll get your check taken care of. Look for an email.

      Thanks,
      Kevin Graham

  5. Good explanation of why you MIGHT want to send the check to Quicken BUT ….

    the “… take a few deep breaths and send that fully endorsed check to Quicken Loans.” should continue on with the caveat “IF you have and escrow account associated with your Quicken mortgage that pays your homeowners insurance.”

    It is not true that “When you get a mortgage with Quicken Loans, you’ll automatically have something called an escrow account.” Granted that is fairly typical and may even be the default but it is not automatic. I always decline the escrow account and manage my own home owners insurance & tax bills rather than commingling them with my mortgage.

    When it comes to changing my homeowners carrier it simply requires notifying Quicken of the change and making sure the new carrier shows Quick appropriately on the new policy.

    Have a wonderful Thanksgiving !

    1. Hi Jim:

      The regulations around this are complicated, but you are correct in stating that not all clients have an escrow account. We are working on getting the post updated. Thanks!

      Kevin Graham

    1. Hi Keith-

      Different mortgage companies may have different policies. While this may be true for some, it isn’t the case for every company. At QL for example, the homeowners insurance refund goes to the client.

      Thanks,
      Kevin Graham

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