Force-Placed Home Insurance in Texas: What It Covers and How to Get It Off Your Loan

For Texas homeowners whose coverage lapsed or was nonrenewed, or whose mortgage servicer says it doesn't have proof of insurance. Reviewed November 2026.

The short answer

Force-placed insurance (also called lender-placed or creditor-placed insurance) is a policy your mortgage servicer buys when it doesn't have proof that your home carries the insurance your loan requires. The servicer then charges you for it. It is built to protect the lender's interest in the house. The Consumer Financial Protection Bureau (CFPB) says it is usually more expensive than a policy you buy yourself and "generally protects only the lender, not you" (CFPB).

To get it off your loan, put a policy of your own in place that meets your loan's requirements and send proof to your servicer. For most home mortgages, federal rules say that within 15 days of getting evidence that you have compliant coverage, the servicer must cancel the force-placed policy. It must also refund, or remove from your account, the force-placed charges for any period when your own policy was also in force (12 CFR 1024.37(g)). You can generally still be charged for any stretch when your home had no qualifying coverage of its own.

Why a servicer places coverage

Almost every mortgage requires you to keep the home insured. A servicer may place coverage when:

• Your policy lapsed, was canceled, or was nonrenewed and no replacement was reported.
• Your policy doesn't meet the loan's requirements, for example because a coverage amount is too low or a required hazard is missing.
• You do have coverage, but the servicer never got the paperwork. This can happen after you switch insurers or your loan moves to a new servicer.

Texas law addresses timing. A lender can't require you to provide evidence of insurance earlier than the 15th day before your existing policy ends. If you haven't provided a qualifying policy by that 15th day, the lender may provide coverage to protect its security interest, as long as it follows the terms of your mortgage documents (Tex. Ins. Code §§ 549.054, 549.056(d)).

What force-placed insurance covers, and what it usually doesn't

The Texas Department of Insurance (TDI) calls this kind of policy single interest insurance. TDI's definition: "Single interest insurance protects only the policy owner, not the homeowner" (TDI glossary).

Texas's collateral protection insurance law allows some flexibility. It lets a lender buy a policy that protects only the lender, or one that protects the lender plus some or all of the borrower's interest. On real property, the lender can choose coverage for the replacement cost of the improvements or for the unpaid loan balance, subject to policy limits (Tex. Fin. Code § 307.051). So the answer depends on the policy. The practical difference from a typical homeowners policy looks like this:

TDI's home insurance guide describes what most Texas homeowners policies include. A force-placed policy is not a substitute for that protection. If you live in the home, you could be uninsured for your belongings and for liability even though the loan shows "insurance" on it.

Texas law also requires a written notice, mailed no later than 31 days after you're charged. It must state the type of coverage, how much coverage there is, whose interest the policy protects, the policy dates, and the total cost to you (Tex. Fin. Code § 307.052). That notice is the best place to see what your specific policy does.

Flood is separate. Federal flood insurance requirements are excluded from the federal force-placed hazard insurance rule, and standard homeowners policies generally don't cover flood. If your servicer says flood coverage is missing, look for a separate flood notice. For loans from federally regulated banks, federal flood rules give you 45 days after notice to get flood coverage before the lender buys it. Within 30 days of confirming your own flood policy, the lender must end its policy and refund the premiums and fees for any overlap (12 CFR 22.7, the version for national banks). See our flood insurance page for how flood coverage works.

The notices you should get before you're charged

For most residential mortgages, Regulation X (12 CFR 1024.37) sets these minimums before a servicer can charge you for force-placed hazard insurance:

1. The servicer needs a reasonable basis to believe you haven't kept the insurance your loan requires.
2. First notice, at least 45 days before any charge. It must say what coverage is missing, ask for your insurance information, and state in bold that the servicer's insurance may cost significantly more and may not provide as much coverage.
3. Reminder notice, at least 15 days before any charge. It can't go out until at least 30 days after the first notice. If you haven't sent any information, it must show the annual premium or a reasonable estimate.
4. No charge if you prove continuous coverage. The servicer can't charge if, by the end of the 15 days after the reminder, it has received evidence that you had compliant coverage in place continuously.
5. Notices go by at least first-class mail. Renewals of force-placed coverage need their own notice at least 45 days ahead.

The rule also says that force-placed charges must be "bona fide and reasonable," except for charges regulated by the state as the business of insurance.

These federal protections don't reach every loan. Home equity lines of credit and business-purpose loans fall outside Regulation X's servicing rules (12 CFR 1024.31, 1024.5), and that can include some rental-property loans. If that describes your loan, read your loan documents and ask your servicer which rules it applies.

The escrow and nonrenewal problem

If you pay insurance through escrow, federal rules generally require your servicer to keep paying your existing policy on time. It can't force-place coverage just because your escrow account is short on money (12 CFR 1024.17(k)).

There is an important exception. The servicer may treat itself as unable to pay through escrow if it reasonably believes your policy was canceled or not renewed for a reason other than nonpayment, or that the home is vacant. In plain terms, escrow pays the bill, but it can't replace a policy your insurer chose not to renew. If you get a nonrenewal notice, replacement coverage is your job, even with escrow. Small servicers also have a limited exception.

If your policy was canceled because your servicer didn't pay the premium from escrow on time, the CFPB suggests you may want to talk with an attorney (CFPB). If your home is or will be empty, see our guide to vacant home insurance in Texas.

Proving coverage vs. buying replacement coverage

If you had coverage all along, your job is to prove it. Send your declarations page or evidence of insurance showing the policy number, the policy dates, the coverage amounts, and your servicer listed as mortgagee — the same proof package Texas buyers assemble before closing (see what lenders look for on a binder). Texas law says that if you show you had the required insurance on or before the day the force-placed policy took effect, and you still have it, the lender must cancel its policy and can't charge you for it (Tex. Fin. Code § 307.054).

If there really was a gap, you'll need a new or reinstated policy. Don't assume a new policy can be backdated to cover the gap. A new policy usually starts on a set date going forward, and availability depends on underwriting. The force-placed policy, meanwhile, may start as early as the date your home became uninsured, but not before it (§ 307.051(d)). Once your new policy is in place and the servicer cancels its coverage, Texas law requires the unearned force-placed premium to be refunded pro rata. The lender then has 14 days after receiving that refund to pass it to you by check or as a credit to your loan (§ 307.055).

Step by step: getting force-placed insurance removed

1. Read the notice closely. Note the date and what the servicer says is missing: no policy, an expired policy, or not enough coverage. Also note how it wants proof sent.
2. Call your insurer or agent. Ask whether your policy is active, whether a lapse can be reinstated, and whether the mortgagee and loan number on the policy are correct.
3. If you're covered, send proof in the format the notice asks for. Ask your insurer or agent to send it to the servicer too. Keep copies and note the dates.
4. If you're not covered, shop for a replacement now. Make sure the coverage meets your loan's requirements. Texas lenders can't require residential coverage above the replacement value of the dwelling and its contents (Tex. Ins. Code § 549.0551). If you were nonrenewed, our guide to shopping your Texas homeowners renewal explains what to ask. If regular carriers have turned you down, our article on the Texas FAIR Plan explains who it's for.
5. Ask in writing for cancellation and a refund of any overlapping charges once you send proof.
6. Check your next statement and escrow analysis to make sure the charges are gone or credited.
7. If it isn't fixed, send a written notice of error. Under Regulation X, an error includes a fee the servicer "lacks a reasonable basis to impose." The servicer generally must acknowledge your notice within 5 business days and respond within 30 business days (12 CFR 1024.35). Use the address your servicer designates for errors, if it has one.

Where to complain

• Your mortgage servicer: CFPB complaint portal or (855) 411-2372.
• Texas-registered mortgage servicers: the Texas Department of Savings and Mortgage Lending, (877) 276-5550. Complaints must be written and signed.
• An insurance company or agent: TDI, Help Line 800-252-3439.

This article is general information from a licensed insurance agency, not legal advice. For a dispute over your loan, consider talking with a Texas attorney.

How Spyglass can help

We can't cancel a servicer's force-placed policy. Only the servicer can do that, once it has proof of coverage. What we can do is review your current policy against your loan's requirements and compare homeowners insurance options from the carriers we work with. If you place a policy with us, we can help get evidence of insurance to your servicer. Coverage and pricing depend on carrier eligibility and underwriting. Request a coverage review or quote, or call (512) 598-9701.