Required Cancellation Documents
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This page is a rough draft and will need more work before it's finalized. |
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This page contains details about NFIP Cancellations. |
The NFIP requires specific documentation to support policy cancellation or nullification requests, with each reason code having unique requirements. Examples include proof of property sale, evidence of duplicate coverage, or a lender's statement confirming flood insurance is no longer needed. Complete and accurate submissions are essential to avoid delays or rejections.
Agents are responsible for ensuring all required documentation aligns with the selected cancellation reason code, as detailed in the Flood Insurance Manual. Certain situations, like fraud or administrative errors, may involve additional steps or FEMA review. By understanding documentation standards and supporting policyholders, agents help ensure cancellations are processed accurately and efficiently.
Common Cancellation Documents by Category
A. No Insurable Interest
- Building sold, removed, or destroyed:
- Bill of sale.
- Settlement statement or closing disclosure.
- Proof of removal or destruction.
- Court documentation for foreclosed properties.
- Legal documents showing ownership transfer due to death of policyholder.
- Contents sold, removed, or destroyed:
- Bill of sale or inventory record.
- Proof of destruction.
- Signed statement from policyholder or representative (for residential contents).
- Documentation of policyholder’s death.
- Property closing did not occur:
- Signed cancellation request or statement from policyholder confirming the closing did not occur.
B. Establish a Common Expiration Date
- Policy rewritten for common expiration date:
- Declarations page of the new flood policy.
- Declarations page of the other insurance policy showing building address and effective dates.
C. Duplicate Coverage
- Duplicate NFIP policies:
- Declarations pages of all duplicate policies.
- Condominium unit or association policy converting to RCBAP:
- RCBAP declarations page.
- Documentation showing the replacement cost value of the unit (if applicable).
- Duplicate non-NFIP policy:
- Declarations page or application form of the non-NFIP policy.
- Proof of payment for the non-NFIP policy.
D. Not Eligible for Coverage
- Property not eligible at time of application:
- Property tax records.
- Section 1316 declaration (floodplain management violation).
- Coastal Barrier Resources Act (CBRA) determination.
- Photographs of the ineligible property.
- Property becomes ineligible mid-term:
- Evidence of ineligibility (e.g., local floodplain management violation, community suspension).
- Annexation documentation if property moves to a non-participating community.
- Building physically altered:
- Photographs or documentation showing the alteration that makes the property ineligible.
E. Lender No Longer Requires Insurance
- Lender statement:
- Signed statement from the lender or policyholder confirming flood insurance is no longer required.
F. Invalid Payment or Fraud
- Invalid payment:
- Notice of returned or rejected payment.
- Fraud or misrepresentation:
- Notification from FEMA confirming fraud or material misrepresentation.
- Insufficient premium to retain coverage:
- Underpayment letter sent to the policyholder.
- Documentation showing the original coverage amount and premium paid.
G. Other Reasons
- Nullification prior to effective date:
- Signed statement from the policyholder requesting nullification.
- SRL written with incorrect insurer:
- FEMA Repetitive Loss list showing the property is designated as SRL.
- Continuous lake flooding or closed basin lakes:
- FEMA notification of the flooding condition.
- Administrative error:
- Documentation of the error, such as system constraints or incorrect use of policy forms.