The CDD Rule is a federal banking regulation (part of the Bank Secrecy Act) that requires financial institutions to verify they're working with legitimate businesses and know who controls those businesses. This prevents money laundering, fraud, and misuse of funds.
Because Thatch's banking partners hold and move your company's funds to pay insurance carriers, they must comply with CDD by verifying your business identity and key owners. Thatch passes this compliance requirement through to you as part of account setup.