Blanket Real Estate Coverage
When a traditional tracking program is not needed or not sufficient to cover a portfolio there is blanket hazard coverage.
Many times it is most beneficial to the lender to track on one portion of the portfolio and to place blanket coverage on another portion. A common example of this is covering the second mortgages with a blanket and tracking only the first position mortgages.
This approach is effective due to the very low risk of second mortgages and the reduced price for the blanket on seconds. In most cases the property must be foreclosed on before a claim can be filed.
Hazard Blanket Plus
GAA’s Hazard Blanket-Plus program combines the basic coverages of the hazard blanket insurance policy with the benefits of a full tracking program. This combination of features allows the benefits of each program to balance the inherent weaknesses of the other.
The fact that Mortgage Hazard Certificates will be covering the majority of the exposure keeps the blanket premiums low as most of the losses are against the lender placed certificates. The result is a sustainable comprehensive coverage program.
There is a 50% discount off the blanket policy due to the tracking program limiting the exposure on the blanket.
An example of where the blanket would cover the loss is if coverage under the certificate program was waived, the loan was not sent to GAA because of an error, or the loan was not being tracked for coverage.
