CAS Mortgage Insurance Primer Presentation
Overview of Property and Flood Insurance
Requirements for Servicers
Property
Insurance
Flood
Insurance
The servicer must:
Verify annually that the selected insurance carrier, policy amount and type of coverage
meet Fannie Mae's requirements.
▪ Ensure requirements contained in any negotiated contract are met.
■ Ensure property insurance premiums are paid.
◉
Immediately obtain new coverage to meet Fannie Mae's requirements if the borrower
allows the insurance coverage to lapse.
■ Contact its Fannie Mae Servicing Representative to determine if additional coverage is
needed if the insurable improvements of the property securing a mortgage loan are exposed
to hazards that a fire and extended coverage policy does not protect against.
Change the insurance coverage for a mortgage loan when it is inadequate to protect
Fannie Mae's interests or, in the instance of lender-placed insurance, causes Fannie Mae to
be overinsured.
■ Ask the property insurance carrier to cancel the policy, in the event of a loan liquidation.
The servicer must:
■ Ensure the property securing the mortgage loan is adequately protected by flood
insurance when required, with no lapses of coverage.
■ Ensure the flood insurance premiums are paid.
Actively monitor all flood maps and community status changes and take appropriate action
as changes occur.
■ Provide evidence of flood insurance coverage to Fannie Mae within 10 business days of
the date of Fannie Mae's request.
■ Increase the coverage for home renovation or construction mortgage loans, if necessary,
when the renovation or construction work is completed or the borrower occupies the
property.
CAS Mortgage Insurance Primer Presentation
10/18/2017
© 2017 Fannie Mae. Trademarks of Fannie Mae.
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