Flood Insurance, Force Placement, and Gap Period
Issue/Inquiry
When a flood insurance policy came up for renewal, the Bank determined that the amount of insurance was inadequate. It reached out to the insurance agency, which increased the amount of coverage and gave the Bank a bill. The issue is that there is a 30-day waiting period before the new coverage goes into effect. Is the Bank required to force place the shortage for that gap period, even though it knows that there will be coverage in 30 days? The Bank does have a blanket coverage policy that will protect it during the gap period.
Continue Reading…