Recently, TWIA and the Texas Department of Insurance (TDI) received important feedback about the flood insurance requirements from policyholders and the agent community. The feedback centered on the interpretation of TDI Rule 28 Texas Administrative Code (TAC) §5.4904, that any repairs which required a certificate of compliance (WPI-8) would then trigger the flood insurance requirement. That requirement has changed.

TDI communicated to TWIA a new/clarified interpretation of TDI Rule 28 TAC §5.4904 this past Friday, July 22, 2016.

TDI’s new/clarified interpretation of TDI Rule 28 TAC §5.4904 is, “the Insurance Code §2210.203(a-1) and 28 TAC §5.4904 do not require policyholders to obtain flood insurance following replacement of a damaged roof or any other repair activity, even if the repair requires a certificate of compliance (WPI-8).”

This new/clarified interpretation of the TDI Rule is the only aspect of the flood insurance requirement that has changed.

We anticipate from agents the question: 
Can my TWIA policyholder cancel their NFIP flood insurance policy?

The answer is:
You should review the terms and conditions of the NFIP policy and the policyholder’s mortgage loan to determine whether to cancel the policy. If the condition that triggered the purchase of flood insurance was a repair (as defined by 28 TAC §5.4904(c)(1)) that required a WPI-8 , the flood insurance policy is no longer required to be eligible for TWIA coverage.

Please note this is only a change in TDI’s interpretation of their Rule 28 Texas Administrative Code §5.4904. There have been no changes to the statutory requirements (the law) for flood insurance, Insurance Code §2210.203(a-1) : Properties located in flood zones V, VE, or V1 - V30 that were constructed, altered, remodeled or enlarged on or after September 1, 2009, and that can obtain flood insurance through the National Flood Insurance Program, must continue to provide proof of flood insurance in order to be eligible for a TWIA policy.

For your reference, our website provides more important information. 

We realize that changes such as this can translate into frustration for agents doing business on the coast. That is why we wanted to make you aware of this change as soon as we could and acknowledge that the flood insurance requirements information sent in the July 14, 2016 issue of the Agent Newswire newsletter is no longer applicable.

We appreciate the feedback we have received from agents and policyholders in reference to this issue. If you have specific questions about the flood insurance requirement, please contact Agent Services at agentservices@twia.org or (800) 788-8247, option 7, M-F 8am to 5pm.

We will continue to keep you informed of any further updates.