Insurance coverage Continuing Education – Cancelling a Flood Insurance Policy


The cancellation or nullification of Flood Insurance Policy procedures can be identified in detail at  –  and it contains some10 pages of detail.  This discussion does not cover all of the intricacies and specifics contained in the manual, but need to give the agent guidance on what canceling or nullifying a policy can entail, what is needed, and how it can be explained to the client.


Refunds will be made by the insurance coverage firm for the present and a single prior year.  If refund is requested for a period of a lot more than two years, then the NFIP should method the request.  The request need to consist of a policy cancellation request and the premium refund calculation for every single year.  (A copy of the cancellation request kind follows.)  The insurer need to also consist of statistical records for each policy term and proof of premium obtaining been received—accounting details which need to be anticipated.


Existing Policy Number: In the upper appropriate-hand corner of the kind, enter the NFIP policy quantity.

Policy Term: Enter the policy term and the cancellation effective date.

Agent Details: Enter the full name, mailing address, phone number and fax quantity of the agent/producer.

Insured Mail Address: Enter complete name, mailing address and phone number of the insured.  If insured has moved, enter the new mailing address.

Initial Mortgage: Enter the total name, mailing address, telephone quantity and fax number of the 1st mortgagee.

Other Parties Notified: Enter the full name, mailing address of all other interested parties that ought to be notified, such as an extra insured, second mortgagee, loss payee, trustee, or disaster help agency.

Property Place: Enter the location of the insured home.

Cancellation Reason Code: Verify the purpose for cancellation of the policy and offer any added details needed.  (A list of cancellation codes follows.)

Refund: Verify the acceptable box to indicate to whom the refund is to be made payable.

When the cancellation/nullification notice has been received and if it directs the NFIP to make a premium refund to the PAYOR, and the policy has been endorsed displaying the PAYOR as a WYO firm or agency, then

F the NFIP will make the refund payable to the insured and mail the refund in care of the producer.

Check the appropriate box to indicate to whom the refund must be mailed.

Signature: The insured have to sign and date the Cancellation/Nullification Request Kind for all cancellation purpose codes except for 5 and 6.  The producer have to sign, date, and enter a Tax ID Quantity or Social Safety number in each case.  Soon after the kind is completed, attach all supporting documents, and mail the original to the NFIP

The producer should retain the second copy the third copy goes to the insured and the 4th copy to the mortgagee.

Following this type has been processed, the NFIP will send the producer, mortgagee and insured a notice of cancellation.



The following cause codes for cancellation/nullification of NFIP policies is a summary of the factors as most of them are self explanatory.  For far more specifics, please refer to the Flood Insurance Manual.

1.  Building Sold or Removed.  Insured has no a lot more insurable interest, or any other reason that the building is sold or removed.  If the creating is sold, proof of sale is needed.  Request should be received within 1 year of sale/removal, accompanied by Bill of Sale, settlement statement, or other such proof of removal or total loss.  Up to two years pro rata refund

two.  Contents Sold or Removed.  Insured no longer has an insurable interest or the property has been removed from the house.  Proof is required, such as Bill of Sale, etc.  Pro rata refund.  Cancellation request must be received inside 1 year of new policy powerful date.

3. Policy Canceled and Rewritten to Establish a Widespread Expiration Date with Other insurance coverage Coverage.  A “housekeeping” reason and new policy have to be rewritten with the very same organization for the exact same or greater” amounts of coverage.  This need to be accompanied by a Cancellation kind for the prior policy.  1 year refund maximum.

four.  Duplicate NFIP Policies.  Refund is pro rata.  Insured can decide on which policy to preserve, but only 1 policy will be efficient.  Document by submitting copy of declaration web page(s) and copy of force-placement letter from the mortgagee if applicable. Force-placement normally has been accomplished by the lender, but if each policies are applicable, the WYO business will cancel the force-placed policy.

five.  Non-Payment.  If there has been an “insufficient funds” verify utilised to spend the premiums, policy is then nullified, with bank’s notice attached to the kind.  A full premium refund will be supplied to the producer if the producer has sent his funds to the insurer.  If the WYO covers the premium for a potential insured and then does not get payment, the policy can be nullified.  Complete refund.

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