Loss Payee

A Loss Payee is a person or entity, usually your mortgage lender, who is legally entitled to receive the payout from an insurance claim. This designation ensures that the bank’s collateral is protected. If your house is destroyed, the claim check will often be made out to both you and the loss payee. You will then need to work with the bank’s insurance department to release those funds to your contractors as repairs are completed, ensuring the home is restored to its full value.