The federal banking agencies and the Financial Crimes Enforcement Network today announced an exemption from customer identification program rules for bank loans to all customers to facilitate the purchase of property and casualty insurance policies, otherwise known as premium finance loans.
In 2018, the agencies and FinCEN granted an exemption from CIP requirements for premium finance loans to commercial customers only. At the American Bankers Association’s request, today’s order broadens the exemption to cover premium finance loans made to all customers, including individuals.
The order concluded that there is a “valid basis for an exemption to apply to all customers of premium finance lending” because premium finance loans present a “low risk of money laundering or terrorist financing” and is “consistent with safe and sound banking.
