When should we consider a flood insurance policy to have “lapsed”?
The flood insurance policy lapses as of its expiration date or the date of cancellation. Although some policies provide a “grace period” after expiration, the Bank should still consider the policy to have lapsed as of the expiration date and not as of the final day of the grace period.
If the Bank sends the 45-day, force-placement notice prior to expiration of the flood insurance policy, does it meet the statutory notice requirements?
No—the Bank is required to send notice upon determining that the flood insurance policy actually has lapsed in order to meet the statutory requirement. Any notice sent prior to lapse may be sent as a courtesy, but would not satisfy the statutory notice requirement.
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