The Biggert-Waters Act also provides that an institution must terminate force placed insurance within 30 days of receipt of
confirmation of a borrower’s existing flood insurance coverage. Additionally, an institution must refund to the borrower all premiums and fees for force-placed insurance paid by the borrower during any period of overlap between the borrower’s policy and the force placed policy. Because an insurer is the entity that actually cancels the policy, an institution need only notify the insurer to terminate the force-placed policy in order to comply with the termination requirement.
There are two steps here - first the bank must terminate the policy - which means based on the last sentence they have to notify the insurance company. The second is that the institution must refund the premiums - it says nothing about waiting on the insurance company for that step.
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