CAS Mortgage Insurance Primer Presentation
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How MI Works: Disaster events
Because mortgage insurers are licensed as monoline insurance companies, MI is
designed to compensate the policy holder for losses due to a default of a mortgage
loan, not for physical damage to the property
Under the MI master policies, an MI claim can be denied in full if the principal
cause of default is determined to be physical damage
Physical damage may be caused by accident or otherwise, such as flood,
earthquake, and any event declared a disaster by the Federal Emergency
Management Agency (FEMA) or other governmental agency; the determination as
to whether it is the principal cause of default is made by:
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Direct evidence
OR if certain additional criteria are met in totality, some of which may
include, but is not limited to
the property has not been restored to its condition on the commitment
date, reasonable (wear and tear excepted), the property is
uninhabitable, the default occurred on or after the date that the physical
damage occurred*
* For a complete list of criteria, please refer to Mortgage Insurance Master Policies
CAS Mortgage Insurance Primer Presentation
10/18/2017
© 2017 Fannie Mae. Trademarks of Fannie Mae. 10View entire presentation