Will a new flood insurance policy dec page no longer indicate a flood zone? Normally, we confirm the zone on the dec page is a match to the zone indicated on our SFHD form. We received a dec page on a new policy with No Flood Zone and we've been told by the agent they will no longer include a specific flood zone on the dec page due to FEMA 2.0 changes effective Oct 1st. I haven't heard that so wanted to ask if this is industry-wide?

Was hoping this would be delayed.....

Yes - that is correct. As of Oct 1 there will no longer be a flood zone listed on a Dec. Page.

Thanks Randy!

Hello, we've started to notice that dec pages have flood zone "X" listed, which is not the zone on the determination. I understand that dec pages are no longer required to have flood zones on them, but I interpreted this as the decs simply omitting the information entirely. I read guidance that indicated discrepancies on dec pages and determinations should simply be "noted," but I'm wondering if flood zone x is going to be the new norm on dec pages?

Likely the insurance company has not updated their software to support the new declaration page requirements. Personally, I would not worry about it. I am assuming this is not a declaration page from the NFIP.

Much appreciated!

Picking up thread......is it printed any where in the rule/regulation the fact that the flood insurance dec pages no longer require the flood zone be stated on them? If it is, could I ask someone to direct me to that information? I appreciate it....and thank you in advance!

https://proctorlp.com/wp-content/up...surance-Manual-Dec-Page-Requirements.pdf

See lines 107 and 109

Awesome....thank you so much!

Quick question - how is everyone confirming that the insurance policy has the correct zone?

They are not because under Risk Rating 2.0, the flood zone means squat when it comes to premiums. It is no longer available to the lender.

Welcome to BOL's Discussion Forums, Willie Reifner, and congratulations on your first of what we hope will be many posts.

Great Question, Willie. In addition to what Randy provided, the 7/6/2020 proposed 2020 Flood FAQs provide additional clarification. Of course, these proposed FAQs are not yet final, but they back up what Randy said - that you don't need to worry about discrepancies - and are a change from old guidance that wanted discrepancies resolved.

From the 7/6/2020 proposed Flood FAQs:

ZONE 1. WHAT SHOULD A LENDER DO WHEN THERE IS A DISCREPANCY BETWEEN THE FLOOD HAZARD ZONE DESIGNATION ON THE FLOOD DETERMINATION FORM AND THE FLOOD INSURANCE POLICY?
If a lender receives a policy declarations page that has a flood zone designation that is different from the flood zone shown on the SFHDF, it should consider documenting the discrepancy in the loan file. If the SFHDF indicates that the building securing the loan is in an SFHA, the lender must require the appropriate amount of insurance coverage in accordance with the Act and Regulation,[64] but the lender is not otherwise required to resolve a discrepancy between the flood zone designation on the SFHDF and the designation on the flood insurance policy declarations page provided by the borrower. This guidance applies to any flood zone discrepancy that arises in connection with a mortgage loan that is made, increased, extended or renewed. In addition, the guidance applies to any building that has been rated in accordance with NFIP procedures.

For a policy issued under the NFIP, if a misrating is discovered at the time of loss resulting from an incorrect flood zone, and a policyholder has underpaid the flood insurance premium, a policyholder may keep the contracted coverage limits if an additional premium is paid. Once paid, a revised declarations page will be issued showing the corrected flood zone. The lender will receive a copy of the declarations page and may receive a copy of the underpayment notice.

If the borrower does not pay the additional premium, resulting in inadequate coverage, lenders must proceed with force-placement procedures.[65] On the other hand, if a policyholder has overpaid the flood insurance premium as a result of a misrating, FEMA may allow a refund of insurance premiums under certain circumstances. See NFIP Flood Insurance Manual for specific instructions. Private policies may resolve flood zone discrepancies differently.

Thanks John, been using this great knowledge for a while!

Are there any other changes from 2.0 that would directly impact lenders and staff? I was not aware of the change in the policy zone deletion until this post. Thanks for clarifying. I even read as much as I could for 2.0 and got blurry eyed from the new way agents will be pricing.

Not really from a lender perspective that I can think of.

Thanks so much!