Sec. 100239. USE OF PRIVATE INSURANCE TO SATISFY MANDATORY PURCHASE REQUIREMENT
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## SEC. 100239 USE OF PRIVATE INSURANCE TO SATISFY MANDATORY PURCHASE REQUIREMENT ###
(a)Amendments Section 102(b) of the Flood Disaster Protection Act of 1973 (42 U.S.C. 4012a(b)) is amended— ####
(1)in paragraph (1)— #####
(A)by striking the period at the end and inserting “; and”; #####
(B)by striking “ lending institutions not to make ” and inserting > “lending institutions— > > > ##### “(A) > > not to make” > ; and #####
(C)by adding at the end the following: > > ##### “(B) > > to accept private flood insurance as satisfaction of the flood insurance coverage requirement under subparagraph
(A)if the coverage provided by such private flood insurance meets the requirements for coverage under such subparagraph.” > ; ####
(2)in paragraph (2)— #####
(A)by striking “paragraph (1)” each place that term appears and inserting “paragraph (1)(A)”; and #####
(B)by inserting after the first sentence the following: “Each Federal agency lender shall accept private flood insurance as satisfaction of the flood insurance coverage requirement under the preceding sentence if the flood insurance coverage provided by such private flood insurance meets the requirements for coverage under such sentence.”; ####
(3)in paragraph (3), in the matter following subparagraph (B), by striking “paragraph (1).” and inserting “paragraph (1)(A). The Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation shall accept private flood insurance as satisfaction of the flood insurance coverage requirement under paragraph (1)(A) if the flood insurance coverage provided by such private flood insurance meets the requirements for coverage under such paragraph and any requirements established by the Federal National Mortgage Association or the Federal Home Loan Mortgage Corporation, respectively, relating to the financial solvency, strength, or claims-paying ability of private insurance companies from which the Federal National Mortgage Association or the Federal Home Loan Mortgage Corporation will accept private flood insurance.”; and ####
(4)by adding at the end the following: > > #### “(5) Rule of construction > > Nothing in this subsection shall be construed to supersede or limit the authority of a Federal entity for lending regulation, the Federal Housing Finance Agency, a Federal agency lender, the Federal National Mortgage Association, or the Federal Home Loan Mortgage Corporation to establish requirements relating to the financial solvency, strength, or claims-paying ability of private insurance companies from which the entity or agency will accept private flood insurance. > > > #### “(6) Notice > > > ##### “(A) In general > > Each lender shall disclose to a borrower that is subject to this subsection that— > > > ###### “(i) > > flood insurance is available from private insurance companies that issue standard flood insurance policies on behalf of the national flood insurance program or directly from the national flood insurance program; > > > ###### “(ii) > > flood insurance that provides the same level of coverage as a standard flood insurance policy under the national flood insurance program may be available from a private insurance company that issues policies on behalf of the company; and > > > ###### “(iii) > > the borrower is encouraged to compare the flood insurance coverage, deductibles, exclusions, conditions and premiums associated with flood insurance policies issued on behalf of the national flood insurance program and policies issued on behalf of private insurance companies and to direct inquiries regarding the availability, cost, and comparisons of flood insurance coverage to an insurance agent. > > > ##### “(B) Rule of construction > > Nothing in this paragraph shall be construed as affecting or otherwise limiting the authority of a Federal entity for lending regulation to approve any disclosure made by a regulated lending institution for purposes of complying with subparagraph (A). > > > #### “(7) Private flood insurance defined > > In this subsection, the term ‘private flood insurance’ means an insurance policy that— > > > ##### “(A) > > is issued by an insurance company that is— > > > ###### “(i) > > licensed, admitted, or otherwise approved to engage in the business of insurance in the State or jurisdiction in which the insured building is located, by the insurance regulator of that State or jurisdiction; or > > > ###### “(ii) > > 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 insurance regulator of the State or jurisdiction where the property to be insured is located; > > > ##### “(B) > > provides flood insurance coverage which is at least as broad as the coverage provided under a standard flood insurance policy under the national flood insurance program, including when considering deductibles, exclusions, and conditions offered by the insurer; > > > ##### “(C) > > includes— > > > ###### “(i) > > a requirement for the insurer to give 45 days’ written notice of cancellation or non-renewal of flood insurance coverage to— > > > ###### “(I) > > the insured; and > > > ###### “(II) > > the regulated lending institution or Federal agency lender; > > > ###### “(ii) > > information about the availability of flood insurance coverage under the national flood insurance program; > > > ###### “(iii) > > a mortgage interest clause similar to the clause contained in a standard flood insurance policy under the national flood insurance program; and > > > ###### “(iv) > > a provision requiring an insured to file suit not later than 1 year after date of a written denial of all or part of a claim under the policy; and > > > ##### “(D) > > contains cancellation provisions that are as restrictive as the provisions contained in a standard flood insurance policy under the national flood insurance program.” > . ###
(b)Technical and Conforming Amendment Section 1364(a)(3)(C) of the National Flood Insurance Act of 1968 (42 U.S.C. 4104a(a)(3)(C)) is amended by inserting after “private insurers” the following: “, as required under section 102(b)(6) of the Flood Disaster Protection Act of 1973 (42 U.S.C. 4012a(b)(6))”.
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Sec. 100239
USE OF PRIVATE INSURANCE TO SATISFY MANDATORY PURCHASE REQUIREMENT
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