OCC BULLETIN 2017-35
Subject: Flood Disaster Protection Act
Date: September 7, 2017
To: Chief Executive Officers and Compliance Officers of All National Banks and Federal Savings Associations, Federal Branches and Agencies, Department and Division Heads, All Examining Personnel, and Other Interested Parties
Description: Revised Comptroller’s Handbook Booklet
The Office of the Comptroller of the Currency (OCC) issued today the "Flood Disaster Protection Act" booklet of the Comptroller's Handbook. This revised booklet replaces a similarly titled booklet issued in May 1999. The revised booklet provides information on changes to the flood insurance requirements resulting from recent amendments to the Flood Disaster Protection Act (FDPA) and the flood insurance regulations (12 CFR 22) and makes other clarifying changes. These changes include an exemption for certain detached structures from the mandatory purchase of flood insurance requirements; escrow requirements for flood insurance premiums and fees for any loan secured by residential real estate or a mobile home that is made, increased, extended, or renewed on or after January 1, 2016; and amendments related to the force placement of flood insurance.
Note for Community Banks
The "Flood Disaster Protection Act" booklet applies to the examination of all national banks, federal savings associations, and federal branches and agencies of foreign banks (collectively, banks) subject to the FDPA and the flood insurance regulations codified at 12 CFR 22.
Updates to the "Flood Disaster Protection Act" booklet reflect
The Biggert–Waters Flood Insurance Reform Act of 2012 and the Homeowner Flood Insurance Affordability Act of 2014 amended the FDPA provisions pertaining to the exemptions from the requirement to purchase flood insurance, the escrowing of flood insurance premiums and fees, and the force placement of flood insurance.
The OCC, the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, the National Credit Union Administration, and the Farm Credit Administration (collectively, the agencies) jointly issued rules addressing the exemption from the mandatory purchase requirement for detached structures, the escrow requirement, and the force placement provision on July 21, 2015 (80 Fed. Reg. 43215).
In addition, the Biggert–Waters Act added to the FDPA a provision mandating the acceptance of a private flood insurance policy meeting certain criteria in satisfaction of the mandatory purchase requirement. The agencies indicated in the 2015 rulemaking that the private insurance provision will be addressed in a separate rulemaking.
For further information, contact Rhonda L. Daniels, Compliance Specialist, at (202) 649-5470.
Donna M. Murphy