[rcooper]

A question we recently received:
We have one of these borrowers that’s usually waits till the last minute to renew flood insurance.
When the extension by FEMA came out we looked at it from the aspect of: Nothing in the Reg. changed, only FEMA letting people take longer to renew their policy. So we will do things as we always do and send the letters and force place if needed. Knowing very well how the FDIC looks at flood insurance think they would be looking for the notifications etc. to be done as usual.
This does not appear to affect Private Insurance Policies as they are not issued through FEMA.
Would there be any recommended temporary changes to our procedures?

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[rcooper]

Answer by Jholzknecht:
It appears that your planned response is consistent with our recommendation. Keep your procedures the same. If you run in to a situation where the borrower intends to renew a FEMA policy, but is running in to a COVID related delay, such as the agent’s reduced office hours, then on a case-by-case basis you could rely of the delay provision. Still we recommend following your normal procedures in such a situation; force place the insurance. If the borrower obtains the coverage at a later date then the force-placed policy can be cancelled and FEMA will issue a full refund of the premiums.

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