On March 11, 2021, the Federal Reserve, Farm Credit Administration, FDIC, NCUA, and OCC (joint agencies) proposed Interagency Questions and Answers Regarding Private Flood Insurance.
The proposal is intended to help lenders comply with the agencies' joint rule promulgated in 2019 to implement the private flood insurance provisions of the Biggert-Waters Flood Insurance Reform Act of 2012.
The proposal incorporates new questions and answers in several areas including:
These FAQs supplement the 118 Interagency Questions and Answers Regarding Flood Insurance that the agencies proposed on July 6, 2020, which revised and reorganized the existing FAQs into new categories by subject to enhance clarity and understanding for users and introduced new FAQs on the escrow of flood insurance premiums, force placement of flood insurance, and the detached structures exemption.
The FAQ documents are intended to help lenders meet their responsibilities pursuant to the federal flood insurance laws that were last updated in 2011. Once finalized, the new FAQs will supersede the 2009 and the 2011 Interagency Questions and Answers, and supplement other guidance or interpretations issued by the agencies relative to loans in areas having special flood hazards. Compliance Officers should closely review the FAQs to ensure flood insurance processes are up to date with the latest joint agency guidance to avoid costly flood insurance violations and penalties. The maximum civil money penalty per flood insurance violation is $2,252.00 for each violation occurring on or after January 15, 2021.
Review the July 6, 2020, proposed FAQs at the following link:
https://www.fdic.gov/news/press-releases/2020/pr20077a.pdf
Review the March 11, 2021, proposed private flood insurance FAQs at the following link:
https://www.fdic.gov/news/financial-institution-letters/2021/fil21016a.pdf
The proposal is intended to help lenders comply with the agencies' joint rule promulgated in 2019 to implement the private flood insurance provisions of the Biggert-Waters Flood Insurance Reform Act of 2012.
The proposal incorporates new questions and answers in several areas including:
- Mandatory Acceptance,
- Discretionary Acceptance, and
- Private Flood Insurance General Compliance
These FAQs supplement the 118 Interagency Questions and Answers Regarding Flood Insurance that the agencies proposed on July 6, 2020, which revised and reorganized the existing FAQs into new categories by subject to enhance clarity and understanding for users and introduced new FAQs on the escrow of flood insurance premiums, force placement of flood insurance, and the detached structures exemption.
The FAQ documents are intended to help lenders meet their responsibilities pursuant to the federal flood insurance laws that were last updated in 2011. Once finalized, the new FAQs will supersede the 2009 and the 2011 Interagency Questions and Answers, and supplement other guidance or interpretations issued by the agencies relative to loans in areas having special flood hazards. Compliance Officers should closely review the FAQs to ensure flood insurance processes are up to date with the latest joint agency guidance to avoid costly flood insurance violations and penalties. The maximum civil money penalty per flood insurance violation is $2,252.00 for each violation occurring on or after January 15, 2021.
Review the July 6, 2020, proposed FAQs at the following link:
https://www.fdic.gov/news/press-releases/2020/pr20077a.pdf
Review the March 11, 2021, proposed private flood insurance FAQs at the following link:
https://www.fdic.gov/news/financial-institution-letters/2021/fil21016a.pdf
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