ACORD 27
The standard evidence of property insurance form used primarily for homeowners and dwelling policies to verify coverage for lenders and mortgagees.
What It Is
The ACORD 27, titled Evidence of Property Insurance, is a standardized form used to provide evidence of property insurance coverage to lenders, mortgagees, and other interested parties. While it can be used for commercial property, it is more commonly associated with homeowners, dwelling fire, and smaller commercial property policies.
The form includes the property location, coverage amounts, deductibles, policy period, and loss payee/mortgagee information. It is simpler than the ACORD 28 and does not contain as much detail about coverage specifics like coinsurance, agreed amount, or business income.
In practice, many lenders and servicers accept either ACORD 27 or ACORD 28 for commercial property evidence, though larger commercial lenders typically prefer the ACORD 28 for its additional detail. The ACORD 27 remains widely used for residential lending and smaller commercial accounts.
Why It Matters for Brokers
Brokers handling both personal and commercial lines must know when to use ACORD 27 versus ACORD 28. Using the wrong form can delay closings or trigger lender compliance letters. For agencies with a mixed book, the ability to quickly and accurately generate the correct evidence form is a basic operational requirement. Errors on evidence forms — particularly wrong coverage amounts or incorrect loss payee information — create friction with lenders and erode client confidence.
Real-World Example
A small business owner purchases a mixed-use building for $1.2M with an SBA 7(a) loan. The lender requires evidence of property insurance showing $1.2M building coverage with the lender as mortgagee. The broker issues an ACORD 27 showing the correct coverage amount and mortgagee clause. The closing proceeds on schedule. Three months later, the lender's servicing department sends a deficiency notice because their system requires ACORD 28 for commercial properties. The broker must reissue the evidence on the ACORD 28 form — a 15-minute task that could have been avoided by using the correct form initially.
Common Mistakes
- 1Using ACORD 27 for commercial property evidence when the lender's requirements specify ACORD 28.
- 2Not verifying the exact mortgagee clause language — Standard Mortgage Clause vs. Loss Payable vs. Lender's Loss Payable have different legal implications.
- 3Listing the property's market value instead of the insured replacement cost value, which may not satisfy the lender's coverage requirements.
How brokerageaudit.com Handles This
COI Manager automatically selects the appropriate form (ACORD 27 or ACORD 28) based on the policy type and lender requirements stored in the account record. It populates all fields from Policy Checker-verified data and validates coverage amounts against lender minimum requirements. The system maintains correct mortgagee clause language for major lenders to prevent errors.