Compliance Journal August 2022
Special Focus Selected Interagency Flood Q&As Recently, the Board of Governors of the Federal Reserve System, Federal Deposit Insurance Corporation, Office of the Comptroller of the Currency, Farm Credit Administration, and National Credit Union Administration released revised Interagency Questions and Answers Regarding Flood Insurance (Interagency Q&As). The Interagency Q&As address frequently asked questions about the flood insurance requirements of the National Flood Insurance Act, as amended, and its accompanying regulation. While the Interagency Q&As do not represent a change in the rules or regulation, they do offer revised guidance on various aspects of the rule. This article presents selected Q&As based upon prominent flood insurance questions. Summary Topics addressed by the revisions include guidance related to major amendments to the flood insurance laws regarding the escrow of flood insurance premiums, the detached structure exemption, force placement procedures, and the acceptance of flood insurance policies issued by private insurers. With the issuance, the agencies have also updated and consolidated all previous Questions and Answers. The Interagency Q&As are organized by category and broken down into numerical designations within their categories. The agencies plan to update and manage these categories accordingly in the future. The current categories are as follows: I. II. III. IV. V. VI. VII. VIII. IX. X. XI. XII. XIII. XIV. XV. XVI. XVII. XVIII. XIX.
Determining the Applicability of Flood Insurance Requirements for Certain Loans Exemptions from the Mandatory Flood Insurance Purchase Requirements Private Flood Insurance—Mandatory Acceptance Private Flood Insurance—Discretionary Acceptance Private Flood Insurance—General Compliance Standard Flood Hazard Determination Form (SFHDF) Flood Insurance Determination Fees Flood Zone Discrepancies Notice of Special Flood Hazards and Availability of Federal Disaster Relief Determining the Appropriate Amount of Flood Insurance Required Flood Insurance Requirements for Construction Loans Flood Insurance Requirements for Residential Condominiums and Co-Ops Flood Insurance Requirements for Home Equity Loans, Lines of Credit, Subordinate Liens, and Other Security Interests in Collateral Located in an SFHA Requirement to Escrow Flood Insurance Premiums and Fees—General Requirement to Escrow Flood Insurance Premiums and Fees—Escrow Small Lender Exception XVI. Requirement to Escrow Flood Insurance Premiums and Fees—Escrow Loan Exceptions Force Placement of Flood Insurance Flood Insurance Requirements in the Event of the Sale or Transfer of a Designated Loan and/or Its Servicing Rights Mandatory Civil Money Penalties