In the complex world of flood insurance compliance, my job is to find the “needle in the haystack” and answer your most difficult, detailed questions.
With the 2023 Flood Conference having passed, I want to share some key takeaways from the event that struck me as things lenders would also like to know.
1. The industry is turning from using the FEMA-derived RCV to determine “insurable value” as a result of some interesting actions taken by the Joint Agencies. As you may know, the Agencies stated in Amount Q&A 2 from the 2022 Interagency Q&As that a variety of methods to determine insurable value are acceptable, including using the replacement cost value listed on a flood insurance policy declarations page.
However, later in the year, the Agencies participated in a webinar where an FDIC representative spoke against using the FEMA-derived RCV as a method of determining insurable value. Then, in the second issue of Consumer Compliance Outlook, RCV listed on a flood insurance policy declarations page was absent in the section that discusses how to determine insurable value. Many in the industry feel as if this was a strategic move, rather than an oversight.
2. The FHA Private Flood Insurance rule was also discussed by a panel of experts, specifically addressing the FHA Compliance Aid Statement. Many organizations, including Miniter Group, are seeing insurance policies that include both the Compliance Aid Statement from the Joint Agencies AND FHA.
If you would like more information on the FHA Private Flood Insurance rule, please view the following blog: FHA Releases Private Flood Insurance Rule
3. Finally, there was some discussion around enforcement actions that have caught the attention of industry professionals. The top 3 causes of enforcement actions in 2022 were:
I’ll also include some article links below if you’d like to read up on these compliance regulations further:
Commercial Flood Insurance & Lender Compliance
Private Flood Insurance & Lender Compliance
Or, take a look at our webinars about the big changes that came with last year’s 2022 regulation changes here.
Finally, note that here at Miniter we find joy in diving deep into the latest regulatory updates that affect our industry. If you have questions, I’m happy to answer them: Ask Us Anything here.