We have a situation on a property claim that we filed on behalf of the mortgage company on a fire claim; the carrier paid $89,000. But they mailed it to the City of Hartford, CT. because there were open third party liens. Now, the mortgage company is asking what can we do to get those funds from the City – are there any options? The mortgage company was not aware of said liens. Does the city have the rights to funds over the servicer/mortgagee?

Texas Subscriber

The policy states that settlement is paid to the insured and the mortgagee as interests appear; if there are multiple mortgagees, then the order of payment is the same as the order or precedence of the mortgage. Therefore, if the state's lien preceded your mortgagee, there really isn't anything that can be done as far as I see in the policy. You might want to look at state regulations, but this is what the policy itself says. I am looking at ISO HO 00 03 05 11.