Flood Insurance Bill

Maia logoFlood Insurance Bill Signed Into Law
Governor Deval Patrick has signed into law House Bill No. H-3783 - An Act Relative to Flood Insurance (Chapter 177 of the Acts of 2014). The new law, which takes effect immediately, prohibits creditors from requiring a purchaser or owner of residential property to purchase or pay for flood insurance on the property
i. at a coverage amount that exceeds the outstanding mortgage on the
ii. that includes coverage for contents; or
iii. that includes a deductible less than $5,000.
The law also requires that if the creditor requires the purchase of flood insurance, the following notice must be provided to the owner or purchaser in clear and conspicuous print:
“Please note that the flood insurance we are requiring you to purchase will only protect your creditor/lender’s interest in your property. It may not be sufficient to pay for many needed repairs after a flood and may not compensate you for your losses in the property due to the flood. If you wish to protect your home or investment, you may wish to purchase more flood insurance than the amount we are requiring you to buy.”
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