I have basic questions brought on by what is showing up in a few of our files post-map change. Declaration pages for preferred risk policies are coming in with the current zone field completed with the prior zone (what it was before becoming a high risk zone with the map change) or blank or N/A. And the map panel numbers still refer to the old map. Shouldn't that number be updated, or does it stay constant to reflect the source of the rate zone? What is the expectation regarding documentation - can we request revised dec sheets or should the file be documented to show why the policy zone does not agree with the current flood zone and then we make sure the forms are correct at the next renewal? (Told you it was a basic question...need to respond to an audit appropriately.) Thanks!

There should be a "grandfathered" indicator on the dec. page. They normally continue to refer to the old rate map under which the grandfathered policy was originally issued.

Thanks, Randy. The policies I'm looking at are not grandfathered yet. I think that will be the next step taken later this year after the two years for the preferred risk extension runs out. So the assumption was that these policies would have to show the rating zone and the actual correct current zone. But they do not.

I did find a draft memo when searching online that suggested to agents that they mark grandfathered to cut down on lender confusion! Perhaps it's timing, but the ones I'm looking at seem to be straightforward preferred risk policies - without the reference to the current flood zone. The two year extension will run out in October. We didn't know whether we had to push for the correct technical completion of the documentatioin or not...or if that was even possible.

Also found a disputed zone between us and the insurance agent that was not resolved. Wow - so we have a policy written on a low risk zone (per the agent's determination) that we say is in a high risk zone. And the map has an edge of the building right on the line. Can only FEMA resolve when the agent has not cooperated - after the fact? (I know the premium would be a substantial increase for the borrower.) I'll do the research on the process options. But again, I'm asking what if a fix is possible now that we're into this by a couple of years.

If they are marked as preferred risk policies, I guess you would be fine. You have enough information (old zone with FHD, new FHD, old policies, etc.) on these existing loans to know that you are OK. If these were new loans, then it might be a slightly different story.

For zone mismatches, I would be providing the customer this infomration to give to their agent and sugggest the customer apply to FEMA for an offical determination (also below).

http://www.fema.gov/pdf/nfip/manual200805/supplement05_2008.pdf

and

http://www.fema.gov/business/nfip/lomri.shtm