source:
  type: guide
  id: fnma-sel-b7-3-01
  authority: Fannie Mae Selling Guide B7-3-01 — General Property Insurance Requirements
    for All Property Published May 6, 2026 856 Types
  description: Fannie Mae Selling Guide B7-3-01 — General Property Insurance Requirements
    for All Property Published May 6, 2026 856 Types.
  coverage_tier: operative
obligations:
- id: fnma-sel-b7-3-01-full
  canonical_id: fnma-sel-b7-3-01-full
  section: Fannie Mae Selling Guide B7-3-01 — General Property Insurance Requirements
    for All Property Published May 6, 2026 856 Types
  type: do
  tags:
  - regulator-direct
  - fnma
  - selling-guide
  - corpus-expansion
  - tier-operative
  primary_source:
    tier: 1
    authority: Fannie Mae Selling Guide B7-3-01 — General Property Insurance Requirements
      for All Property Published May 6, 2026 856 Types
    source_class: fnma-guide
    source_url: https://singlefamily.fanniemae.com/media/document/pdf/selling-guide
    snapshot_id: 5f7b8b79da595d76
    fetched_at: '2026-05-25T14:09:57Z'
    content_hash: sha256:98cf85a02861bbe84914a0e339b327c8fc131869a8a573882007bbeea60c5701
    paragraph_quote: 'B7-3-01, General Property Insurance Requirements for All Property
      Published May 6, 2026 856 Types (12/14/2022) Introduction This topic contains
      information on property insurance requirements for insurers, including: Overview
      Property Insurer Rating Requirements Exceptions to Insurer Rating Requirements
      Other Exceptions to Property Insurance Requirements Overview The borrower has
      the right to select the insurer of their choice to provide property insurance
      for the subject property, provided that the insurance meets Fannie Mae''s requirements.
      The lender or servicer must ensure that the insurer, policy, and coverage meet
      Fannie Mae''s requirements. In some cases, Fannie Mae may require additional
      coverage that diﬀers from these requirements. Note: References to "lender or
      servicer" include the lender or seller at origination and the servicer for the
      duration of loan servicing. Property Insurer Rating Requirements The property
      insurance policy for the property securing any ﬁrst mortgage, including master
      policies for project developments, must be written by an insurer that meets
      one of the rating requirements in the following table. Rating Agency Rating
      Category AM Best Company “B” or better Financial Strength Rating Demotech, Inc.
      “A” or better Insurance Financial Stability Rating Kroll Bond Rating Agency
      “BBB” or better Insurance Financial Strength Rating (IFSR) S&P Global “BBB”
      or better Insurer Financial Strength Rating Note: An insurer is only required
      to meet the rating category requirement for one of the rating agencies, even
      if they are rated by multiple rating agencies. Published May 6, 2026 857 Exceptions
      to Insurer Rating Requirements The following are exceptions to Fannie Mae’s
      insurer rating requirements: Second Mortgages — The property insurance policy
      for a property that secures a second mortgage does not have to be written by
      an insurer that meets Fannie Mae’s rating requirements, unless Fannie Mae also
      has an interest in the ﬁrst mortgage. Mortgage Impairment (or Mortgagee Interest)
      Insurance — If the lender or servicer, as applicable, is covered by a mortgage
      impairment (or mortgagee interest) insurance policy, and the issuer meets either
      the AM Best Financial Strength Rating or S&P Global Insurer Financial Strength
      Rating, as listed in Property Insurer Rating Requirements, Fannie Mae does not
      require conﬁrmation that the borrower’s property insurance coverage is with
      an insurer that meets Fannie Mae’s rating requirements. However, in such instances,
      the lender should advise the borrower of Fannie Mae’s requirements when it originates
      the loan. Reinsurance Arrangements — Policies written by an insurer that do
      not meet Fannie Mae’s rating requirements are acceptable provided all conditions
      outlined in the following table are met. ✓ Conditions for Acceptable Reinsurance
      Arrangements The insurer is covered by reinsurance with a company that meets
      the AM Best Financial Strength Ratings or S&P Global Insurer Financial Strength
      Rating, as listed in Property Insurer Rating Requirements. The primary insurer
      and the reinsuring company are authorized (or licensed, if required) to transact
      business within the state where the property is located. The reinsurance agreement
      has a “cut-through” endorsement that provides for the reinsurer to become immediately
      liable for 100% of any loss payable by the primary insurer in the event the
      primary insurer becomes insolvent. Both the primary insurer and the reinsuring
      company execute an Assumption of Liability Endorsement (Form 858), or any equivalent
      endorsement that provides for 100% reinsurance of the primary insurer’s policy
      and a 90-day written notice to Fannie Mae of the termination of the reinsurance
      arrangement. Note: Form 858 (or the equivalent endorsement) must be attached
      to each insurance policy covered by the reinsurance agreement, unless the lender
      or servicer, as applicable, is covered by a mortgage impairment (or mortgagee
      interest) insurance policy. The reinsurance agreement does not allow contributions
      or assessments to be made against Fannie Mae or to become a lien on the property
      that is superior to Fannie Mae’s lien. Published May 6, 2026 858 ✓ Conditions
      for Acceptable Reinsurance Arrangements The insurance written under the policy
      cannot exceed any dollar limitation amount speciﬁed in the reinsurance endorsement.
      Other Exceptions to Property Insurance Requirements Fannie Mae also accepts
      the following types of property insurance policies if they are the only coverage
      that can be obtained at the time of the loan closing or policy renewal: policies
      obtained through state or territory insurance plans, including a state’s Fair
      Access to Insurance Requirements (FAIR) plan, or other state-mandated windstorm
      and beach erosion insurance pools. Recent Related Announcements The table below
      provides references to recently issued Announcements that are related to this
      topic. Announcements Issue Date Announcement SEL-2022-10 December 14, 2022 Announcement
      SEL-2021-11 December 15, 2021'
  judgment: false
