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The bill’s sponsors say it was spurred by southeast Minnesota homeowners who — prior to the August floods — mistakenly thought their homeowner policies covered flood damage.
The bill also requires insurance companies to tell policy holders they can purchase flood insurance through the National Flood Insurance Program, said Rep. Ken Tschumper, DFL-La Crescent.
Some homeowners knew their insurance policies didn’t cover flood damage but mistakenly believed they weren’t able to purchase a separate flood policy, Tschumper said.
Anyone can buy government flood insurance if they live in a community that participates in the national program. All of the homeowners affected in August were eligible for such insurance, Tschumper said, but many didn’t believe they were because their home wasn’t in a floodplain.
“Very little insurance came into this disaster because people didn’t understand they could have bought it,” Tschumper said.
The bill requires insurance companies to mail annual notices to homeowners whose policies are renewed after August 2008.
Contact Mark Sommerhauser at (507) 453-3514 or msommerhauser@winonadailynews.com.
