FDIC FAQs – May a lender commence a force-placed insurance policy on the day the previous policy expires, or must the new policy begin the day after?

Compliance > Lending > Flood > FAQs
Q:  May a lender commence a force-placed insurance policy on the day the previous policy expires, or must the new policy begin the day after?
 
A:    If the previous policy expires at midnight at the end of Day 1, the lender’s new force-placed policy should not begin to provide coverage until just after midnight at the beginning of Day 2. If the lender did force place on Day 1 and the policy provided overlapping coverage, the lender could not charge and collect premiums and fees from the borrower for the period of overlapping coverage on Day 1.
 
 
 
ADDITIONAL INFORMATION:
This Q&A was included in the FDIC’s Flood Insurance Videos, which were updated in 2016, which may be found here:   https://www.fdic.gov/news/news/financial/2016/fil16018.html
 

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