If a previously force placed flood insurance policy is expiring, can the bank send the 45-day notification letters prior to policy expiration? And then force place the renewal flood policy immediately at expiration with a final letter stating it was done?

Additionally, if the bank identifies a gap in coverage of an existing flood policy can they instant issue a force placed policy to cover the gap and then simply send 1 letter to the borrower stating the gap coverage was force placed?

Getting push from the lines of business on some audit issues I found in which supposedly the CFPB recently told them they were ok. Any help is appreciated!

The only policy you can pre-notify on is if you are using the NFIP MPPP program.

What is a gap on an existing policy?

OK, that makes sense. I was trying to figure out what an MPPP program was and thought maybe it was simply a forced policy. So, I'm good there.

As far as the gap in the existing policy, this is if the borrower provides a policy within the 45-day notification period but it is not sufficient or it does not go back to the date of the prior policies expiration. They think they can instant issue a force placed policy for the gap?

Ultimately, I think what is happening is they are confusing hazard rules with flood in some cases.

Thank you for your help!

You have the choice to force place flood insurance day one when you send the 45 day letter or when the letter expires. If you are waiting to cover the gap after the fact, then I have to ask two questions.

1) Did the property actually flood during the gap and would your insurance company actually pay a claim when you actually bought the policy after the flood event, and

2) if they won't pay, why would you force place after the fact and charge the borrower for it. Smacks of UDAAP to me.