Miss. Legislation to Require Homeowners to Refuse Flood Insurance in Writing

The goal of HB 982, approved Jan. 20 by the Mississippi House of Representatives is to make the basics of home insurance more understandable to homeowners and would require home buyers to refuse flood insurance in writing. A similar bill, SB 2014, is pending in the Mississippi Senate.

Both bills are a reaction by legislators to educate property owners and make sure that if other hurricanes hit their state, they will understand that flood insurance is provided by the federal government, not private companies.

“Hopefully, it will be more consumer friendly,” House Insurance Committee Chairman Mark Formby, R-Picayune, told the Jackson Clarion-Ledger.

House Bill 982 requires agents to inform buyers of the difference between flood and homeowner’s insurance policies. The customer would then sign a form acknowledging their understanding. The bill passed 101-17 and heads to the Senate.

“If we had done this last February, we could have saved people a lot of headaches,” Formby said.

Senate Bill 2014 is similar and adds the disclosure that contents coverage may be available with the flood policy for an additional premium.

The bills are “good practice,” Insurance Commissioner George Dale commented. However, he doesn’t want lawmakers to forget the risk in north Mississippi.

The New Madrid fault runs into the northern portion of the state, and scientists warn the fault is unstable, Dale said. He wants homeowners there signing a form to acknowledge their refusal of earthquake insurance.

“Scientists keep telling us one of these years,” Dale said. “We have short memories about disasters.”

Senate Insurance Committee Chairman Dean Kirby, R-Pearl, said his version will be up for a vote in a few weeks.

“Hopefully, it will help some people,” Kirby, an insurance agent said. The bill may reduce some complaints, but not all, he said.

“I would like to say yes (complaints would drop),” Kirby said. “We had the very same scenario with Camille.”

Topics Legislation Flood Homeowners Mississippi