Flood Insurance: Revised Interagency Questions and Answers

The Federal Deposit Insurance Corporation (FDIC), the Office of the Comptroller of the Currency (OCC), the Board of Governors of the Federal Reserve System (FRB), the National Credit Union Administration (NCUA), and the Farm Credit Administration (FCA) (collectively, the Agencies) are issuing the revised Interagency Questions and Answers Regarding Flood Insurance (Interagency Questions and Answers ). The Interagency Questions and Answers address frequently asked questions about the flood insurance requirements of the National Flood Insurance Act of 1968, as amended, and its accompanying regulation. These Interagency Questions and Answers consolidate questions and answers that were proposed by the Agencies in July 2020 and in March 2021.

The revised Interagency Questions and Answers can be found on the FDIC website.

Statement of Applicability: This Financial Institution Letter applies to all FDIC-supervised financial institutions.

Highlights:

• The Interagency Questions and Answers provide information to assist financial institutions in meeting their federal flood insurance compliance responsibilities, and to increase public understanding of flood insurance requirements.
• The Agencies are issuing 144 new and updated questions and answers on flood insurance to reflect significant legislative changes to the flood insurance requirements made by the Biggert–Waters Flood Insurance Reform Act of 2012 and the Homeowner Flood Insurance Affordability Act of 2014.
• In July 2020, the Agencies proposed new and revised questions and answers that covered a broad range of topics related to technical flood insurance issues, including the escrow of flood insurance premiums, the detached structure exemption to the mandatory purchase of flood insurance requirement, and the force placement procedures. In March 2021, the Agencies also proposed new questions and answers related to the private flood insurance provisions of the Biggert-Waters Act.
• The Interagency Questions and Answers incorporate the public comments received from the two proposals issued in July 2020 and March 2021. The Agencies made non–substantive revisions to certain previously issued questions and answers to more directly respond to the questions, to provide additional clarity, or to make other technical corrections. Additionally, the Agencies reorganized the questions and answers by topic to make it easier for users to find and review information related to technical flood insurance topics.
• These Interagency Questions and Answers supersede the 2009 Interagency Questions and Answers (and the 2011 amendments to the 2009 Interagency Questions and Answers) and supplement other guidance or interpretations issued by the Agencies not covered by the Interagency Questions and Answers .