Flood Essentials 2027

Flood insurance compliance is one of the most technical—and frequently misunderstood—areas of lending compliance. From determining when coverage is required to calculating the appropriate amount of insurance, managing escrow obligations, and monitoring policies throughout the life of a loan, even small process failures can expose financial institutions to regulatory violations and costly corrective action.

This live webinar breaks down the federal flood insurance requirements that lenders need to understand and apply. Explore the rules governing mandatory flood insurance, exemptions, private flood insurance, borrower notices, escrow requirements, force placement, and ongoing coverage monitoring. Learn how these requirements apply across different lending situations, including construction loans, home equity transactions, subordinate liens, and residential condominiums.

The session also examines common compliance weaknesses, practical approaches to strengthening internal controls, and the challenges that arise when flood insurance coverage is unavailable or a National Flood Insurance Program (NFIP) policy cannot be obtained. Through a practical review of regulatory requirements and compliance considerations, you will gain a clearer understanding of how to manage flood insurance obligations from origination through servicing.

Whether you are responsible for making flood determinations, reviewing loan files, monitoring insurance coverage, or overseeing your institution’s compliance program, this session will help you identify potential gaps, improve procedures, and reduce avoidable compliance risk.

Participants will receive a detailed reference manual to support ongoing compliance efforts long after the webinar concludes.

WHAT YOU WILL LEARN

• Determine When Flood Insurance Is Required: Understand the applicability of federal flood insurance requirements and how they affect different types of loans and collateral.
• Recognize Applicable Exemptions: Review exceptions to the mandatory purchase requirement, including the detached structure exemption, and understand the conditions that must be met.
• Evaluate Private Flood Insurance: Understand mandatory and discretionary acceptance requirements, applicable compliance considerations, and the documentation needed to support policy acceptance.
• Complete Flood Determinations and Notices: Review the Standard Flood Hazard Determination Form (SFHDF), flood determination fees, zone discrepancies, and required borrower notices.
• Calculate Required Coverage: Understand how to determine the appropriate amount of flood insurance and recognize common errors involving coverage limits and collateral.
• Navigate Complex Lending Situations: Examine flood insurance requirements for construction loans, condominiums and cooperatives, home equity loans, lines of credit, subordinate liens, and other security interests.
• Understand Flood Insurance Escrow Requirements: Review escrow obligations, the small-lender exception, and other applicable exceptions to escrow requirements.
• Manage Force Placement Requirements: Understand the procedures and timing considerations for force-placing coverage when required insurance is missing or insufficient, including applicable notice and reimbursement obligations.
• Monitor Coverage Throughout the Loan Lifecycle: Identify strategies for tracking policy renewals, detecting lapses, addressing insufficient coverage, and maintaining appropriate controls when loans or servicing rights are transferred.
• Address NFIP Availability Challenges: Explore applicable requirements and risk-management considerations when federal flood insurance is unavailable, including the role of private flood insurance.
• Strengthen Examination Readiness: Recognize common flood insurance compliance weaknesses and develop practical approaches to improve policies, procedures, quality control, monitoring, and audit practices.
• Understand Potential Penalties: Review the circumstances that may lead to civil money penalties and the importance of identifying, correcting, and preventing recurring violations.

WHO SHOULD ATTEND?

This webinar is designed for compliance officers, loan operations managers, mortgage lenders, loan processors, loan servicing personnel, risk managers, internal auditors, and other professionals responsible for flood insurance compliance. It is also valuable for employees involved in flood determinations, insurance tracking, escrow administration, collateral review, quality control, and the development or oversight of lending policies and procedures.