24 MAY / JUNE 2017 Article author Rod Lasley Vice President - Products & Services Indiana Bankers Association rlasley@indianabankers.org Twitter: @rodlasley Know That Your Collateral Is protected Most bankers can recall receiving calls from customers who have totaled their cars or lost their homes to fire. After verifying your customer is safe, your next step is to verify that his or her insurance on your loan collateral (car or house) is current. There are a few moments of apprehension as you look through the file to find the policy and see that it is in effect. Rather than having to experience this feeling of uncertainty or dismay, if the policy is expired, let an established professional alleviate your concerns. Lee & Mason Financial Services, an IBA Preferred Service Provider, has been helping banks in these various areas of collateral protection for over 50 years. A family-owned business, Lee & Mason is recognized as one of the pioneers in vendor single interest line of insurance. The company operates as a full-service program administrator handling underwriting, quoting and binding, policy issuance, premium collection, and complete claims processing and reporting. Lee & Mason represents several insurance companies, with all of the carrier partners being “A” rated by A.M. Best. The lines of business that banks find most critical are blanket lender’s single interest (LSI), blanket mortgage hazard coverage; and lender-placed mortgage hazard coverage, with or without insurance tracking. In the non-real estate collateral area, blanket LSI protects the lender from uninsured damage to the vehicle or loan collateral, occurring before repossession or for a limited time after repossession. It also covers the lender against loss of collateral when the borrower and vehicle cannot be located, or when the vehicle has been seized by a public authority. Additionally it protects the lender from an error or omission in the process of securing its interest in the loan collateral. The major benefits of this offering is the complete coverage of the loan portfolio, no insurance tracking, no administrative burden, and the premium may be passed on to the borrower. For the loan portfolio that is collateralized by real estate, Lee & Mason offers two options for banks. Blanket mortgage hazard coverage provides property coverage on your entire mortgage portfolio, including residential, commercial and mobile homes, and can include second mortgages and equity loans. This coverage also can be used for real estate owned (REO) portfolios. The blanket coverage eliminates the need for insurance follow-up after closing and the need to track and report individual properties and policies. The second option for real estate collateralized loans is lender-placed mortgage hazard coverage, which provides the bank with property coverage on specific loans the borrower fails to insure. It, too, covers residential, commercial and mobile homes; additionally, it is available for second mortgages, equity loans and REO portfolios. As with the other policy options, the cost of this coverage can be passed on to the borrower. As your bank is continually asked to track more information and provide more reports to regulatory agencies, let Lee & Mason take care of the tracking and reporting of insurance on your loan portfolio. This is one area where you can use an expert and eliminate worry about insurance coverage for that next emergency phone call from your customer. For more information about Lee & Mason Financial Services, contact Rod Lasley at 317-387-9380, rlasley@ indianabankers.org; or contact Matt Washer or Jim Reilly at Lee & Mason at 502-894-0899, email mwasher@ leeandmason.com or jreilly@leeandmason.com. HB PSP SHOWCASE
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