New Rule Covers Private Flood Insurance

Joint Release

Board of Governors of the Federal Reserve System

Farm Credit Administration

Federal Deposit Insurance Corporation

National Credit Union Administration

Office of the Comptroller of the Currency

NR 2019-15

FOR IMMEDIATE RELEASE

February 12, 2019

New Rule Covers Private Flood Insurance

WASHINGTON-Five federal regulatory agencies issued a joint final rule to implement provisions of the Biggert-Waters Flood Insurance Reform Act of 2012 requiring regulated institutions to accept certain private flood insurance policies in addition to National Flood Insurance Program policies.

The rule, which takes effect July 1, 2019:

- Implements the Biggert-Waters Act requirement that regulated lending institutions accept private flood insurance policies that satisfy criteria specified in the Act;

- Allows institutions to rely on an insurer's written assurances in a private flood insurance policy stating the criteria are met;

- Clarifies that institutions may, under certain conditions, accept private flood insurance policies that do not meet the Biggert-Waters Act criteria; and

- Allows institutions to accept certain flood coverage plans provided by mutual aid societies, subject to agency approval.

Regulations implementing the federal flood insurance statutes prohibit regulated lending institutions from making loans secured by improved real property located in special flood hazard areas unless the property has adequate flood insurance coverage.

Media Contacts

Federal Reserve Board

Susan Stawick

(202) 452-2955

FCA

Toni DeLancey

(703) 883-4056

FDIC

David Barr

(202) 898-6992

NCUA

John Fairbanks

(703) 518-6330

OCC

Bryan Hubbard

(202) 649-6870