ALEXANDRIA, Va. – Federal credit unions cannot replace third-party collateral protection insurance and private mortgage insurance with their own internal programs, according to NCUA.
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Credit unions may not self insure, as was proposed by Alliance FCU in Lubbock, Texas, because then they would be acting as an insurer, which is not a permissible activity for federal credit unions, NCUA said. “Insurance is not an express power or incidental power for FCUs,” said the federal regulator.
