Compliance Alliance Q&A 11/27/2018


A customer provided the flood insurance binder. However, my loan dep is requesting that we also obtain paid receipts and a copy of the flood application. Is this necessary?


Yes, a binder is not recognized as proof of insurance for closing a loan. However, a paid receipt and copy of the application is recognized. 

D. Evidence of Insurance

A copy of the Flood Insurance Application and premium payment, or a copy of the declarations page, is sufficient evidence of proof of purchase for new policies. The NFIP does not recognize binders. However, for informational purposes only, the NFIP recognizes certificates or evidences of flood insurance, and similar forms, provided for renewal policies if the following information is included: 

1. Policy Form/Type (GP, DP, RCBAP*, PRP)

2. Policy Term

3. Policy Number

4. Insured’s Name and Mailing Address

5. Property Location

6. Current Flood Risk Zone

7. Rated Flood Risk Zone (zone used for rating, including when grandfathering or issuing coverage under the Newly Mapped procedure)

8. Grandfathered: Y/N  


Page 16 of the Manual: 


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