FEMA Map Revision - Hartford Insurance Refusing to Cancel Flood Policy

[chad101]

What is the name of your state (only U.S. law)? Michigan

I was ecstatic when I received a letter from my mortgage company stating I no longer needed to carry flood insurance. Our insurance rate was increasing every 6 months; we were ready to walk away from this property...

Aware of the FEMA refund policy (up to 1 year) and with the holidays right around the corner, I felt a sense of relief, knowing I could catch up on bills.

I contacted my local insurance company and provided a copy of the letter from my mortgage lender. I was told the refund should not take long; most likely I would receive it before the holidays.

A few days later, I received a letter form Hartford with an enclosed "opt out" coupon; asking for my signature to cancel the policy. I promptly signed the coupon and mailed it out the following day.


3 days pass, and I receive a letter from Hartford stating that my policy could not be canceled. The following explanation was provided. And I quote:

"We are unable to process your request for cancellation as the Map Panel change date is not within the current policy term. If eligible this policy can be rewritten to a Preferred Risk Policy or we can set this policy to non-renew."

This sounds a little fishy to me. Do I need to file a complaint with the FTC and BBB? My employer provides free legal services though Hyatt Legal (I would have to check if this situation would be covered). I'm disgusted; why should I have to pay for flood insurance until my policy cancels? This just don’t sound right, do I have a legal foot to stand on?

 

[moburkes]

1. Did you contact Hartford directly so they could explain the letter?
2. There is no need to sue. If you don't believe them you can contact the department of insurance for your state and file a complaint. MUCH cheaper than a lawsuit.
3. What FEMA refund policy are you referring to? You can get a refund for multiple years under specific conditions.
4. What is the date of the letter from the mortgagee?
5. What is the EXACT reason stated that you no longer need flood insurance?

Your mortgage no longer requiring insurance is completely separate from federal law. Flood policies can only be cancelled in specific situations - Hartford doesn't determine this. Federal law does.

From what I can tell, you can only cancel a policy during its initial term for the reason "policy not required by mortgagee". If your policy has renewed one time, that is no longer an eligible reason to cancel your policy. (if property was located in SFHA)

There is a 2nd situation (similar) but a copy of the revised map is required.

 

[tammy8]

Your mortgage no longer requiring insurance is completely separate from federal law. Flood policies can only be cancelled in specific situations - Hartford doesn't determine this. Federal law does.

Hey Mo!!!!!

I hate flood insurance!!!! That being said I had something similar happen to one of my insureds a couple of years ago. Was told by flood company they didn't refund money, unless the policy was written incorrectly and could be rerated and resissued, if they had duplicate coverage OR when the policy renew (and insured or mortgage company didn't pay).

 

[moburkes]

That's true, for the most part. Flood insurance, while cancelable, will rarely give a refund except in specific situations. That's partially why they require up front payment - no refunds, so nonpayment (except bounced check or reversed credit card) shouldn't ever happen.

But receiving that letter from the mortgage company is one way it can be refunded - if he acted quickly (within the same policy term, usually). But he needs to provide more information on the letter.


And - hey girl! Happy Holidays! Trying to make it up to your state by the end of summer. Think our plan (hope it's God's plan too) is to be in NC, not SC.