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The regulatory requirements for private flood insurance have been undergoing change since Congress passed and the President signed the Biggert-Waters Flood Insurance Reform Act (Biggert-Waters Act) in 2012. Finally the almost seven year journey is complete. During January 2019 the Comptroller of the Currency, the Federal Reserve Board, the Federal Deposit Insurance Corporation, and the Farm Credit Administration (the Agencies) published a final rule implementing the private flood insurance rules, effective July 1, 2019.
Every financial institution must adapt their policies and procedures for the new rules. The potential civil monetary penalties for non-compliance with the revisions are substantial. The final rule differs dramatically from the previous regulatory guidance and from the 2016 proposed rule.
This program explains the new final rules for private flood insurance, explores the options for compliance and provides suggestions for successful implementation of the requirements.
Participants receive a detailed manual that serves as a handbook long after the program is completed.
Upon completion of the program participants understand:
The new final private flood insurance rules;
When private flood insurance must be accepted and when it may be accepted, including "discretionary acceptance;"
How to identify a policy as a private flood policy instead of a FEMA policy;
How the Compliance Aid works;
The process for verifying and documenting the presence and acceptability of the Compliance Aid statement;
Issues related to the side-by-side policy review including:
When is a side-by-side review required;
Who should conduct the review; and
How to conduct and document the review;
The issues related to having a third party conduct the side-by-side review;
The issues related to passing the cost of the side-by-side review, whether conducted by the creditor or by a third-party, on to the consumer
What is a mutual aid society and when can coverage from such a group be accepted;
The content of acceptable policies and procedures for implementing the new rules;
How to train appropriate staff to comply with the new requirements; and
The potential penalties for not complying with the new requirements.
The program is designed for loan officers, compliance officers, loan processors and clerks and auditors.
Private flood Insurance - The Final Rules
Questions and Answers