It basically comes down to the insurance agent has no idea what they are doing. They cannot bind an NFIP regardless of the circumstances - only NFIP can do that. Can they submitted the policy application and premium ahead of time - yes. Also, as long as the payment was received within 10 days of closing from the borrower, the day of loan closing should have been the effective date.
The opinions expressed here should not be construed to be those of my employer: PPDocs.com