Sets the definition of "principal" for the purposes of limits on amount of flood insurance required by a mortgagee; clarifies applicability of the state law relative to certain federal programs and requirements.
STATE OF NEW YORK
________________________________________________________________________
8030--A
2025-2026 Regular Sessions
IN ASSEMBLY
April 22, 2025
___________
Introduced by M. of A. HUNTER -- read once and referred to the Committee
on Judiciary -- recommitted to the Committee on Judiciary in accord-
ance with Assembly Rule 3, sec. 2 -- committee discharged, bill
amended, ordered reprinted as amended and recommitted to said commit-
tee
AN ACT to amend the real property law, in relation to limits on amount
of flood insurance required by a mortgagee
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Section 283 of the real property law, as amended by chapter
2 64 of the laws of 2025, is amended to read as follows:
3 § 283. Limits on amount of flood insurance required by mortgagee. 1.
4 No mortgagee shall require a mortgagor to whom the mortgagee makes,
5 increases, extends, or renews any loan or line of credit secured by
6 improved residential real property to purchase or pay for flood insur-
7 ance on such residential real property: (1) at a coverage amount that
8 exceeds the lesser of the replacement value of the improvement on the
9 residential real property or the outstanding principal mortgage balance
10 as of the beginning of the year for which the policy shall be in effect;
11 or (2) that includes coverage for contents. In the case of an open-end
12 line of credit, "principal" shall include the full line of credit amount
13 regardless of the amount that has been drawn on the line of credit. In
14 each instance where a mortgagee requires a mortgagor to purchase or pay
15 for flood insurance on such residential real property, the mortgagee
16 shall provide notice to the mortgagor at the time the mortgagee is noti-
17 fied of the need to purchase or pay for flood insurance that states the
18 following in clear and conspicuous print: 'The flood insurance we are
19 requiring you to purchase may not be sufficient to pay for many needed
20 repairs after a flood and may not compensate you for your losses in the
21 property due to the flood. If you wish to protect your home or invest-
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD10859-02-6
A. 8030--A 2
1 ment, you may wish to purchase more flood insurance than the amount we
2 are requiring you to buy.'
3 2. Any entity subject to the requirements of subdivision one of this
4 section and subject to the National Flood Insurance Act (42 U.S.C. §
5 4001 et. seq.) and implementing regulations issued by Board of Governors
6 of the Federal Reserve System, the Federal Deposit Insurance Corpo-
7 ration, the Office of the Comptroller of the Currency, the National
8 Credit Union Administration, or the Farm Credit Administration, as
9 applicable, shall not be in violation of subdivision one of this section
10 when it requires flood insurance in minimum required amount or for
11 contents under the National Flood Insurance Act and applicable regu-
12 lations.
13 3. For purposes of this section, residential real property shall have
14 the meaning as set forth in subdivision five of section four hundred
15 sixty-one of this chapter.
16 4. This section shall not apply to residential real property that is
17 used for collateral on a loan along with additional residential real
18 property or properties.
19 § 2. This act shall take effect immediately.
