Safeco Uses Internet To Reduce 'False Placement'.

If technology developments in the past were all about increased functionality, many of today's are about making systems faster and more accurate.

Safeco Select, an insurance provider for mortgage lenders, is a case in point. Safeco helps lenders make sure that the collateral that backs mortgage loans is protected by hazard and flood insurance. When a homeowner fails to maintain insurance, it is up to the lender to place hazard, wind or flood insurance on the property.

It's a tricky business that is prone to errors that can exacerbate a lender's relationship with its clients. If the information on a lender's servicing system is inaccurate, a 'forced-placement' of insurance can easily turn into a 'false-placement' that aggravates the borrower.

Peter Lo of Safeco says that Internet-based communication systems not only reduce hardware, software and training requirements, they can reduce mistakes.

Mr. Lo said demand from Safeco's existing clients has motivated the move toward an Internet-based system, and that can be leveraged to attract additional clients as well.

"The use of the Internet for a wide variety of products and services and inquiries has become so pervasive that it becomes an oddity if the lender has to go into a green screen environment," he said.

For lenders that rely on Safeco to place hazard insurance on properties where there has been a lapse in coverage, the Internet provides a means of ordering coverage online. A browser-based system is ...