Freddie Mac Single-Family Seller/Servicer Guide 4703.1 — General property insurance requirements

Freddie Mac Single-Family Seller/Servicer Guide 4703.1 — General property insurance requirements

Effective 2026-09-16 · Freddie Mac's stamp for this section

This section contains requirements related to: ■ Licensing of insurer ■ Assessments ■ Rating of insurer For Mortgages sold to Freddie Mac, the Seller must ensure that the Mortgaged Premises are covered by insurance meeting the requirements in this Chapter 4703. The Seller must obtain evidence of insurance meeting the requirements of Section 8202.4. (a) Licensing of insurer All insurance companies (insurers) and insurance companies that guarantee coverages provided by other insurance companies (reinsurers) must be licensed, or otherwise authorized by law, to conduct business in the jurisdictions where the Mortgaged Premises are located. (b) Assessments Insurance contracts must provide that: ■ No assessment may be made against the Seller/Servicer or Freddie Mac, and ■ Any assessment made against others may not become a lien on the Mortgaged Premises superior to the lien of the Freddie Mac Mortgage (c) Rating of insurer The required insurance must be provided by one of the following insurers: 1. An insurer with a current rating that meets the requirements below: Current rating requirements Rating company Minimum rating AM Best Company (AM Best) Financial Strength Rating of B+, as reported online at http://www.ambest.com Demotech, Inc. Financial Stability Rating of A as reported online at http://www.demotech.com S&P Global Insurer Financial Strength Rating of BBB as reported online at http://www.standardandpoors.com Kroll Bond Rating Agency Insurance Financial Strength Rating of BBB as reported online at https://www.kbra.com 2. A non-admitted insurer with a current rating that meets the requirements below: ■ AM Best: A minimum Financial Strength Rating of A, or ■ S&P Global: A minimum Insurer Financial Strength Rating of AA− 3. An insurer with coverage that is guaranteed by a reinsurer under all of the following conditions: ■ The reinsurer’s current rating meets the requirements below: ❑ AM Best: A minimum Financial Strength Rating of B+, or ❑ S&P Global: A minimum Insurer Financial Strength Rating of BBB ■ The reinsurer assumes by endorsement 100% of the insurer’s liability for any covered loss payable but unpaid by the insurer for reason of insolvency ■ The reinsurer assumes by endorsement to give the policyholder, Seller/Servicer and insurer 90 days’ written notice before canceling or otherwise terminating the guarantee ■ The above endorsements are attached to each property insurance policy accepted by the Seller/Servicer 4. A State insurance pool created by statutory authority to provide insurance for geographic areas or insurance lines that suffer from lack of voluntary market availability. (Such pool may be designated as a property insurance plan, a Fair Access to Insurance Requirement plan, an underwriting association, a joint underwriting association or an insurance authority.) 5. An insurer with coverage that is guaranteed by the National Flood Insurance Program under a Standard Flood Insurance Policy issued pursuant to the National Flood Insurance Act of 1968, as amended Note: Insurers rated by more than one rating company need only meet one of the rating requirements.

Source: Freddie Mac Single-Family Seller/Servicer Guide 4703.1 — General property insurance requirements · source URL · snapshot e399c3dcaab28da0