Do banks have insurance for times when they make a mistake and make property tax payments to wrong addresses?
Although banks carry Errors and Omissions policies, the coverage typically has a deductible that is much higher than the amount of any residential tax payment amount -- a large tax bill on commercial property might be an exception. If a bank paid a tax bill in error, the bank would be entitled to reclaim the payment from the city or town involved. If state law prevented the recovery of such a payment after a period of time, the bank could attempt to recover the amount of the incorrect payment from the property owner that benefited wrongfully from the error.
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Although banks carry Errors and Omissions policies, the coverage typically has a deductible that is much higher than the amount of any residential tax payment amount -- a large tax bill on commercial property might be an exception. If a bank paid a tax bill in error, the bank would be entitled to reclaim the payment from the city or town involved. If state law prevented the recovery of such a payment after a period of time, the bank could attempt to recover the amount of the incorrect payment from the property owner that benefited wrongfully from the error.
