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Acceptance of Private Flood: State for Insurance

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Pertaining to the acceptance of private flood policies, my question is in reference to the statement found in the OCC Federal Register (vol. 84 no. 34 pg. 4955). “Specifically, the proposed rule … to mean an insurance policy that: (1) is issued by an insurance company that is licensed, admitted, or otherwise approved to engage in the business of insurance in the State or jurisdiction in which the property to be insured is located, by the insurance regulator of that State or jurisdiction or, in the case of a policy of difference in conditions, multiple peril, all risk, or other blanket coverage insuring nonresidential commercial property, is recognized, or not disapproved, as a surplus lines insurer by the State insurance regulator of the State or jurisdiction where the property to be insured is located.” Please confirm which state the licensure would be verified in. Is it in the state the real property is located in, the state in which the agent is, or the state in which the insurance company is located? For example: assume our real property is in Louisiana, the agent is in Texas and insurance company is in Massachusetts. My interpretation of this statement is we would verify licensure in the state of Louisiana, but it's confusing.

Since the policy covers the property - the insurance company would be licensed in the State of the property. Whether a Texas agent could sell insurance in LA, that would be another question, but not really pertinent to your question.

First published on 08/18/2019

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