Citibank, N.A., and CitiMortgage, Inc. (together, Citi), have agreed to settle a putative class action lawsuit over force-placed insurance (FPI). Under the settlement, members of the proposed settlement classes will be entitled to receive more than $110 million in refunds of FPI premiums that were charged to their accounts by Citi.
Specifically, settlement class members who were charged for force-placed hazard insurance will receive back 12.5% of their force-placed hazard insurance premiums upon submitting a claim, which represents over 83.3 percent of the allegedly unlawful commissions that Citi's affiliate received on force-placed hazard insurance (15% of the premium), from its force-placed insurance vendor.
Moreover, Citi has agreed to refund eight percent of the force-placed flood insurance premiums and 8% of the force-placed wind insurance premiums to settlement class members who submit claims, even though no commissions were paid to Citi or its affiliates on flood or wind insurance.
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