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Mitchell, Meeks, Bloomfield article published by ABA Banking Journal

ABA Banking Journal
July 2019

Charlotte Litigation Members Neil Bloomfield and Barbara Meeks, and Associate Elena Mitchell’s article titled, “Parting the Waters of Uncertainty for Private Flood Insurance,” was published by the ABA Banking Journal on July 1.

The Article

A final interagency rule taking effect on July 1, 2019, provides federally regulated lending institutions with eagerly awaited guidance concerning private flood insurance for improved properties located in special flood hazard areas. Pursuant to the final rule, the OCC, Federal Reserve, FDIC, Farm Credit Administration and National Credit Union Administration seek to increase availability and use of private flood insurance coverage by instructing regulated lending institutions to accept certain private flood insurance, and by giving regulated lending institutions greater discretion as to the types of private flood insurance that can be accepted.

Notably, under the final rule, regulated lending institutions may determine that a private policy provides acceptable flood insurance coverage if the policy or an endorsement to the policy contains the following language: “This policy meets the definition of private flood insurance contained in 42 U.S.C. 4012a(b)(7) and the corresponding regulation.” The final rule, therefore, provides significant relief and guidance to federally regulated lending institutions by allowing greater flexibility in what private policies can be accepted for improved properties in SFHAs.

The complete article can be read here.