Limitations on required Flood Insurance coverage in Massachusetts

Hurricane Flooding Whether you own a home, condo or multi-family, you will now have the option to cover only the outstanding loan balance on your flood insurance policy. Massachusetts state law now limits the amount of flood insurance a creditor can require of an owner or purchaser of residential property in a Special Flood Hazard Area (SPFA). This Massachusetts flood insurance law change came into effect as of September 11, 2015.

Specifically, creditors cannot require flood insurance on a property in a Special Flood Hazard Area that:

  1. exceeds the outstanding principal mortgage balance at the beginning of the policy year;
  2. includes coverage for contents; or
  3. includes a deductible of less than $5,000.

Additionally, upon renewal of the flood insurance policy, the owner of the Massachusetts residential property can request a reduction in the amount of flood insurance coverage to an amount equal to the outstanding principal mortgage balance at the beginning of the year that the policy shall be in effect.

It is important to note that although the creditor cannot require the purchase of flood insurance with these characteristics, the property owner may select to do so in order to more fully protect their property and equity from flood risk.

Although most flood insurance policies cover structural damage and clean up, be sure to also discuss with your insurance agent content or personal property coverage, for example:

  • Personal items like a TV, DVD, computer, clothing, toys
  • Furnishings, for example, sofa, dining set, entertainment center
  • Portable and window air conditioners, dehumidifier
  • Washer and dryer
  • Refrigerator, freezer and the food in them

It is always a good idea to document a thorough home inventory of your belongings to help if ever you need to file an insurance claim.

We’re here to help! For a no cost, no obligation review and comparison of your insurance, please contact us.

Guard Insurance Agency is a Trusted Choice independent insurance agency, representing multiple companies to get you the best price, offer individual attention in order to qualify you for all the discounts available, and of course, provide excellent service, voted Best of 2013, BestofSurveys.
Please be advised that insurance coverage cannot be bound or changed via submission of this online form/application, e-mail, voice mail or facsimile. No binder, insurance policy, change, addition, and/or deletion to insurance coverage goes into effect unless and until confirmed directly with a licensed agent.

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