Preferred Risk Policy

Posted By: Sugarbaker

Preferred Risk Policy - 11/07/12 03:07 PM

Is it the lenders responsiblity to make sure a borrower qualifies for a preferred risk policy?

We have a borrower whose property has been in a flood plainf or the 10 years we have had the loan. Now the agent is issuing PRP policies showing rated zone x and current zone A. We questioned the last policy, the agent said he would look into it. We get a renewed policy dec sheet and once again it is stated that it is a PRP. We don't believe it is since this property has been in a flood zone for many years, but is this a battle we should fight as long as they show the current zone as correct?

Not really sure what to do with this - maybe bankers can just start underwriting and issuing the policies too - I think it would be easier. The agents don't seem to have any responsiblity ensuring they are correct. Stepping off my box . . .
Posted By: rlcarey

Re: Preferred Risk Policy - 11/07/12 03:38 PM

As long as a policy in hand meets the regulatory requirements, what the agent is doing to the customer is between them.
Posted By: Sugarbaker

Re: Preferred Risk Policy - 11/07/12 03:41 PM

Thanks Randy.