The Board approved a final interagency rule (Part 760) to amend regulations covering loans in areas with special flood hazards.
NCUA and four other federal financial services regulatory agencies jointly prepared the rule to amend federal flood insurance regulations and implement provisions of the Biggert-Waters Flood Insurance Reform Act of 2012 and the Homeowner Flood Insurance Affordability Act of 2014. The rule requires the escrow of flood insurance payments on residential improved real estate securing a loan, incorporates an exemption for certain detached structures and clarifies provisions relating to the forced placement of flood insurance when homeowners’ policies lapse or are insufficient.
The rule’s flood insurance escrow provisions would only apply to credit unions with more than $1 billion in assets. Thus, more than 96 percent of credit unions would be exempt from the flood insurance escrow requirements.
Parts of the final rule, available here, become effective Oct. 1, 2015, and others have an effective date of Jan. 1, 2016.
http://www.ncua.gov/News/Pages/NW20150622FloodRule.aspx
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