Budget Amendment ID: FY2015-S4-28

OTH 28

Flood Insurance Coverage

Messrs. Hedlund, Tarr, Ross, Keenan and Joyce moved that the proposed new text be amended moved that the bill be amended SECTION XX. Chapter 183 of the General Laws, as appearing in the 2012 Official Edition, is hereby amended by inserting after section 68 the following section:-

Section 69. No creditor, as defined in section 35B of chapter 244, shall require in a mortgage, note or otherwise, 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 thereon; (ii) that includes coverage for contents; or (iii) that includes a deductible less than $5,000. In each instance where a creditor requires in a mortgage, note, or otherwise, a purchaser or owner of a residential property to purchase or pay for flood insurance on said property, the creditor shall provide notice to the purchaser or owner of the residential property at the time the purchaser or owner of the residential property is notified of the need to purchase or pay for flood insurance that states the following 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.'