Sets the definition of "principal" for flood insurance limits required by mortgagees and clarifies state law applicability to federal programs.

This bill amends the real property law to define "principal" for the purposes of limiting the amount of flood insurance required by a mortgagee. It specifies that the principal includes the full line of credit amount for open-end lines of credit, regardless of the amount drawn. The bill also mandates that mortgagees provide notice to mortgagors when requiring flood insurance, informing them that the required insurance may not be sufficient for full property repair or loss compensation.

Sets the definition of "principal" for flood insurance limits required by mortgagees and clarifies state law applicability to federal programs.

This bill amends the real property law to define "principal" for the purposes of limiting the amount of flood insurance required by a mortgagee. It specifies that the principal includes the full line of credit amount for open-end lines of credit, regardless of the amount drawn. The bill also mandates that mortgagees provide notice to mortgagors when requiring flood insurance, informing them that the required insurance may not be sufficient for full property repair or loss compensation.