The hearings produced an order from New York Gov. Andrew Cuomo to submit a new proposal for premium rates saying the state's homeowners were overcharged "to the tune of millions of dollars."

At the federal level, the Consumer Financial Protection Bureau is drafting new rules aimed at giving consumers more rights to deal with force-placed insurance, and the nation's major mortgage lender, Fannie Mae is reviewing its relationships with servicers and insurers.

Fannie Mae has called for a request for proposals from force-placed insurers, a process aimed at reducing costs to both Fannie Mae and the consumer. Fannie Mae says the current system results in "an incentive arrangement between lender-placed insurers and servicers that disadvantages Fannie Mae and the homeowner."

When asked about the status of the RFP, Fannie Mae issued a statement saying it "is pleased to be making progress on the lender-placed-insurance RFP process so that we can lower costs for homeowners, taxpayers, and Fannie Mae while reducing a barrier that struggling borrowers face in getting current on their mortgage. We are currently finalizing the list of providers that will advance to the next round in the process."

At the state level, more regulators are also asking questions about force-placed-insurance practices. The National Association of Insurance Commissioners plans to hold a hearing looking into insurer practices at its upcoming meeting in August.

To consumer advocates who criticized the insurance programs in testimony at the New York hearing and elsewhere, the problems with force-placed insurance are not unique to New York.

J. Robert Hunter, director of insurance for the Consumer Federation of America says that among the issues with force-placed insurance is that regulators have done little to oversee the product. He notes that states have not reviewed rates in years, in a line of business where the same large insurance providers charge the same rates throughout the country.

It is a highly profitable line, says Birny Birnbaum, executive director for the Center for Economic Justice, but the rates that are charged are not justified by loss ratios.

According to his calculations, from 2004 to 2011, while homeowners insurers' loss ratios ran from a low of 48.2 in 2006 to a high of 76 in 2011, force-placed insurers were dramatically less, running in the 20s.

The highest loss ratio over that eight year period for force-placed insurers was 53.5 in 2005, says Birnbaum. In that same year, homeowners insurers raked-up a loss ratio of 75.2.

The lending institutions and mortgage servicers also come under criticism since they profit on the commissions they receive, referred to as kickbacks by the consumer advocates.

"The banks have a legitimate need for insurance to be in place to protect their collateral," says Hunter. "It could be done as blanket coverage or individually as long as it is fairly priced. They have got to stop ripping off poor people as they have been doing for decades."

For their part, the two leading force-placed insurers, Assurant and QBE have both expressed their desire to cooperate with regulators in testimony in New York and Florida.

In the New York case, Assurant issued a statement saying that it has submitted proposed revisions to its program plans to continue to cooperate with the state, but declined additional comment.

It issued a separate statement saying it plans to participate in the NAIC's upcoming hearings and looks "forward to discussing the facts about the value of our program, the steps we take to protect customers, and the assistance we provide homeowners who would otherwise go unprotected."

QBE has expressed similar sentiments, noting that the reason the insurance is more expensive is because it does not select the risks it insures nor underwrites them. The carrier is obligated in cover all risks in the lender's portfolio.

Regarding regulators' queries, QBE says in a statement that it "has been fully cooperative with all its regulators and has made it a point to communicate frequently and transparently with each of them."