Sets the definition of "principal" for the purposes of limits on amount of flood insurance required by a mortgagee and clarifies applicability of the state law relative to certain federal programs and requirements.
Impact
The enactment of S08066 could significantly influence how mortgagees operate in New York, especially in flood-prone areas. By standardizing the requirements for flood insurance, it aims to provide clarity and fairness in mortgage transactions. Homeowners will benefit from reduced financial burdens associated with inflated insurance requirements, and the bill serves to protect their investments in residential properties. It seeks to ensure that homeowners are adequately informed about their insurance obligations and the reality of potential losses associated with flooding.
Summary
Bill S08066 seeks to amend the real property law in New York concerning the limits on the amount of flood insurance required by mortgagees. Specifically, it establishes guidelines stating that mortgagees cannot require higher flood insurance coverage than the lesser of the property's replacement value or the outstanding mortgage balance. This adjustment aims to alleviate financial pressures on homeowners by preventing excessive insurance requirements that do not align with the actual value at risk. Additionally, the bill mandates that mortgagees inform mortgagors about potential gaps in flood insurance coverage, encouraging them to consider additional coverage if they wish to fully protect their property against flood risks.
Contention
While S08066 has the potential to positively impact consumers, there may be contention regarding how it aligns with existing federal programs and regulations. Mortgagees might express concerns about liability if their requirements are not fully compliant with rules under the National Flood Insurance Act. Some stakeholders may argue that this bill could lead to underinsurance, leaving homeowners vulnerable to significant losses in the event of a flood if their insurance coverage does not cover actual damages. The balance between protecting consumers and ensuring adequate flood coverage remains a critical issue in the discussions around this bill.
Same As
Sets the definition of "principal" for the purposes of limits on amount of flood insurance required by a mortgagee and clarifies applicability of the state law relative to certain federal programs and requirements.
Clarifies the definition of "first building permit" for purposes of filing requirements to qualify for an abatement of tax payments for certain industrial and commercial properties located in a city of one million or more persons.
Prohibits mortgagees from requiring mortgagors of certain residential real property to purchase flood insurance exceeding a coverage amount that exceeds the balance as of the beginning of the year for which the policy shall be in effect, or that includes coverage for contents.
Prohibits mortgagees from requiring mortgagors of certain residential real property to purchase flood insurance exceeding a coverage amount that exceeds the balance as of the beginning of the year for which the policy shall be in effect, or that includes coverage for contents.
Clarifies the application of standardized testing requirements to the general education development exam by explicitly including it in the definition of "standardized test" and "test".