The FDIC, OCC, Federal Reserve, Farm Credit Administration and National Credit Union Administration today issued a proposed rule implementing the 2012 Biggert-Waters flood insurance reform law’s efforts to stimulate a robust marketplace for private flood insurance that would offer a competitive alternative to the National Flood Insurance Program.
The proposal, which revisits a proposed rule issued three years ago, includes several provisions responsive to concerns the American Bankers Association raised in its comment letter. Among them are an expansion of the compliance safe harbor included in the original proposal and granting discretion for lenders to accept, under certain conditions, policies that do not meet the statutory definition of private flood insurance.
The proposal also includes a carve-out for insurance-like coverage provided by mutual aid societies. Comments on the proposal are due 60 days after it is published in the Federal Register. For more information, contact ABA’s Anjali Phillips.