PORTFOLIO Knee-deep in flood insurance compliance Compliance Avoiding flood insurance-related violations requires understanding loans, notifying customers and/or assessing insurance coverage requirements. By Mary Thorson Wright pril may bring showers and flowers, but it can also bring snow and ice thaws with torrents of runoff and flooding. The threat of flooding ranks high on the risk meter for bank loans secured by improved real property. One critical difference between flood and other regulatory requirements is that it is not limited to consumer-purpose 18 Q ICBA Independent Banker Q April 2019 A transactions, and may expose banks to greater risk for larger, commercial-purpose loans. Flood insurance requirements are overseen by the Federal Emergency Management Agency (FEMA), and comprise the National Flood Insurance Act of 1968 (NFIA) and many significant amendments. Flood compliance requirements for federally regulated financial institutions became effective when Congress enacted the Flood Disaster Protection Act of 1973. Federal bank regulatory agencies issued regulations to financial institutions under their supervision to not " make, increase, extend, or renew any loan secured by