Basically this bill is trying to build a wall between the parties concerned. Insurers and agents will be prohibited from issuing collateral protection insurance on properties that they own, service, or have rights to service. The bill also prohibits the giving of compensation, including the payment of commissions, to lenders, insurers, investors or servicers on collateral protection insurance policies. Premium and risk sharing between the insurer and the lender, investor or servicer receiving the collateral protection insurance is off the table. Similarly contingent commissions, profit-sharing arrangements, and any payments linked to profitability or loss ratios flow to the service provider or anyone associated with the insurer. Even outsourcing is scrutinized – insurers may not provide free or low-cost outsourced services to lenders, investors or servicers, nor may they outsource their own functions to lenders, insurance agents, investors or servicers at the above cost.
Georgia lawmakers propose sweeping collateral protection insurance restrictions & more related News Here
