The Bank, or a servicer acting on its behalf, must deposit the flood insurance premiums and fees on behalf of the borrower in an escrow account.
The escrow account is subject to FEMA requirements that limit the amount that may be maintained in escrow accounts for certain types of loans and requires escrow account statements if the loan is otherwise subject to RESPA.
There is a small lender exception to certain escrow requirements. Consult Bank Counsel and see 12 CFR §399.5.