Refund on Homeowner's Insurance Policy

[BananaCabana]

I was talking to our insurance company the other day about our car insurance and told her about the foreclosure and bankruptcy. She then told me that the bank had paid the homeowner's insurance for 2012 and that if we did not own the home anymore then she can issue me a refund. I told her that couldn't be correct as we haven't paid the policy for over two years now. She said it didn't matter, that we are the owner's of the policy and no matter who paid it the refund goes to the policy holders.

This would be a great relief if it really is legal and I won't be held responsible for taking the refund that the bank paid. I could REALLY use that money.

Has anyone recently been through this? And those who may have done this in the past have there ever been any reprecussions for accepting a refund on your homeowner's policy?

I will gladly accept the money but I don't want someone to come to me in the future and tell me we have to pay them back for it.

In my mind this isn't right, but out of neccessity I want it to be.

[tobee43]

indeed, i did get a nice refund from our homeowners insurance company as well. the insurance company said they are going to pass the costs on to the foreclosure fees and it's your money so we are sending you a check. i said are you sure..they said yes and i rec'd a check for almost 900 dollars.

[catleg]

The mortgage servicer generally is responsible for paying property taxes and insurance even when you're in default.
A typical homeowners policy is void if the property is vacant for more than 30 days.
So you would be entitled to a refund of premiums paid.
The servicer when they find out will put their own more expensive 'forced placed' insurance on the property (usually written by a captive insurance subsidiary) and capture more profits out of the foreclosure.
In the end it means Fannie/Freddie/mortgage backed security holders get ripped off, not by you, but by the banks.