Freddie Mac Single-Family Seller/Servicer Guide 2101.6 — Seller/Servicer insurance requirements

Freddie Mac Single-Family Seller/Servicer Guide 2101.6 — Seller/Servicer insurance requirements

Effective 2026-06-08 · Freddie Mac's stamp for this section

(a) Coverage requirements The Seller/Servicer must maintain in effect, at all times and at its expense (i) a fidelity bond and (ii) a mortgagee’s errors and omissions (E&O) insurance policy. The required limits and deductibles/retentions for each coverage are set forth in Sections 2101.7 and 2101.8, respectively. If the Seller/Servicer uses a bond or policy that has been issued to its parent company, as permitted in Section 2101.6(c), the minimum limit of insurance must be based on the consolidated Base (as defined in Section 2101.7(c)) amount for the parent and for all institutions related to the parent that are covered by the parent’s bond or policy, as applicable. Freddie Mac will accept bonds or policies that provide for an aggregate limit of insurance for a bond’s or policy’s term on the condition that the aggregate at least equals the minimum limit per loss or occurrence calculated in accordance with this Section 2101.7 or 2101.8, as applicable. If the Seller/Servicer is also a Freddie Mac Multifamily Seller/Servicer and coverage required under this Guide and the Freddie Mac Multifamily Seller/Servicer Guide is provided under the same insurance contract, the higher minimum required coverage limit shall apply to the Seller/Servicer. If the Seller/Servicer maintains broader coverage and/or higher limits than required by this Guide, Freddie Mac requires and shall be entitled to the benefits of the broader coverage and/or higher limits maintained by the Seller/Servicer. Freddie Mac reserves the right to adjust the insurance requirements for any particular Seller/Servicer at Freddie Mac’s sole discretion. (b) Acceptable insurer Coverage required under this section must be underwritten by an insurer that is rated A- (Aminus) or better by the A.M. Best Company. (c) Parent institution’s coverage When the Seller/Servicer is a subsidiary of an institution with insurance that meets Freddie Mac’s requirements set forth in Sections 2101.6 through 2101.9, Freddie Mac will accept the insurance of the Seller/Servicer’s parent as adequate for the Seller/Servicer if: ■ The Seller/Servicer is named as joint insured, and ■ Coverage under the parent’s policy or policies of insurance does not restrict or otherwise limit the Seller/Servicer’s ability to comply with all of Freddie Mac’s insurance requirements (d) Other obligations of the Seller/Servicer The Seller/Servicer must maintain at its offices a complete and accurate copy of its required insurance bonds and policies for the current year and the past five years. Copies of these bonds and policies shall be provided to Freddie Mac upon request. The Seller/Servicer authorizes Freddie Mac to obtain copies of the bonds and policies and all related information from the Seller/Servicer’s insurer and/or agent or representative of the insurer. Freddie Mac’s requirements for Seller/Servicer insurance do not diminish, restrict or otherwise limit the Seller/Servicer’s responsibilities and obligations stated in the Purchase Documents. The Seller/Servicer must familiarize itself with the terms of the required insurance coverages and take all actions necessary to preserve the coverage and maximum benefits of such insurance for the Seller/Servicer and Freddie Mac, as applicable. In the event of bankruptcy where a stay is issued in relation to insurance coverage, the Seller/Servicer is required to cooperate with Freddie Mac and agree to any stipulation requested by Freddie Mac to lift the automatic stay in connection with Freddie Mac pursuing its rights and/or benefits under any of the bonds and policies required by this Guide. For any E&O policy provided on a “claims made” or “claims made and reported” basis, the Seller/Servicer must maintain continuous coverage dating back to the date on which the Seller/Servicer became subject to this Guide. In the event of termination or non-renewal of an E&O policy issued on a “claims made” or “claims made and reported” basis, the Seller/Servicer shall either procure replacement coverage that provides for the same continuity required by this section, or, if such continuity is not available in the marketplace, purchase an extended reporting period (sometimes referred to as tail coverage) on the terminated/non-renewed coverage for six years.

Source: Freddie Mac Single-Family Seller/Servicer Guide 2101.6 — Seller/Servicer insurance requirements · source URL · snapshot 4c94f67729042dd6