NCUA issues alert on flood insurance; NFIP lapse possible
The NCUA Tuesday issued a Regulatory Alert to help credit unions prepare for the July 1 implementation deadline of an interagency rule that requires mortgage lenders to accept both private and government-backed flood insurance policies. The alert came as Congress struggles to reach a deal on an extension of the National Flood Insurance Program (NFIP).
The NCUA alert outlines specifics for the acceptable alternatives to NFIP policies, which include:
- private flood insurance that meets the rule’s definition;
- private flood insurance accepted on a discretionary basis; and
- mutual aid society plans.
“Credit unions should be aware of this significant policy change in flood insurance regulations and update policies and procedures to address these alternative options to NFIP policies,” said NCUA Chairman Rodney Hood in the alert.
continue reading »