WASHINGTON—Mortgage servicers will be required to escrow premiums and fees for flood insurance under a regulation now being proposed by federal banking agencies.
Don Griffin. vice president, personal lines for the Property and Casualty Insurers Association of America and also chairman of the WYO Flood Insurance Coalition, said most large lenders and their servicers already allow homeowners required to have flood to spread out their premium payments over 12 months. This will likely only impact small lenders who do not already do so, and therefore make the practice uniform, he said.
John Prible, vice president of federal government affairs for the Independent Insurance Agents and Brokers of America, added that, "This will provide an additional payment option for consumers, which is a good thing as long as the Federal Emergency Management Agency gets it right and doesn't make it too cumbersome on either banks or WYO's."
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