Legal Question in Business Law in California

I have 2 properties. One house and one condo. My condo was damaged. I made an insurance claim with my insurance company, Kemper, and they paid for the damages and wrote me a check.

Later on, my house was damaged. I made an insurance claim with my insurance company, Travelers, and they looked at the damages and wrote a check. However, the check they wrote is payable to both me AND the lienholder of the property. I have asked Travelers to make the check only payable to me, but they refuse. I am in default on the home and I am negotiating with the lienholder for a loan modification. Therefore, I cannot cash an insurance check that is payable to both me and the lienholder since the lienholder probably won't sign off on the check and let me deposit it since I am in default with them.

Kemper wrote a check directly to me for the damage to my condo, so is what Travelers doing in refusing to write a check directly to me legal?


Asked on 8/20/15, 6:01 pm

3 Answers from Attorneys

Bryan Whipple Bryan R. R. Whipple, Attorney at Law

If you are in default with your lienholder, it has probably recorded an instrument asserting a claim to insurance proceeds in some way or another. I'd suggest as an easy starting point to go make a current check at the county recorder's office and see what's recent.

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Answered on 8/21/15, 7:39 am
Nicholas Spirtos Law Offices of Nicholas B. Spirtos

Most likely Travelers conduct is appropriate. It may depend on what the policy says and whether there are any recorded liens against the property.

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Answered on 8/21/15, 9:26 am
William Christian Rodi Pollock

Look at your loan documents. They almost certainly require that your lended be named as an additional insured and specifically requires the check be jointly payable. This is a standard provision to make sure you don't keep the money and stiff the lender. The insurer doesn't care who gets the money but makes it payable to both, as your loan documents require, so the lender does not sue them.

Do you even have a mortgage on the Condo? I would guess not.

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Answered on 8/21/15, 3:58 pm


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