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NewsFriday, June 20, 2008 12:07 PM CDT
Governor puts moratorium on flood insurance cancellations
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SPRINGFIELD — Gov. Rod Blagojevich on Thursday said that companies can’t cancel insurance policies of residents affected by recent flooding, even if homeowners are behind on their payments.

“People are hurting and the last thing they need to worry about is having their insurance policies canceled during this very difficult time,” Blagojevich said.

Private insurance companies sell flood policies on behalf of the National Flood Insurance Program run by the Federal Emergency Management Agency. FEMA is responsible for setting rates, deductibles and coverage terms.

The moratorium on cancellations lasts 60 days, and two major Illinois insurers say the governor’s policy is a good one.

State Farm Insurance Cos. spokeswoman Missy Lundberg couldn’t say how many flood victims are customers of the Bloomington-based company, but she said the insurer covers about one-third of houses in Illinois.

She said State Farm officials were meeting Thursday to work out flood response details.

“We are cooperating with the moratorium,” Lundberg said.

Country Financial spokeswoman Chris Anderson said the Bloomington company heard about the upcoming moratorium Tuesday. She said the policy is not uncommon when natural disasters strike.

“Our concern is that they get their lives back as soon as possible,” she said.

Blagojevich’s order would cover all 21 counties that had been declared disaster areas as of June 10.

The governor has the authority to issue the order because a state agency regulates the insurance industry in Illinois.

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Reader comments on this story - 2 total

Note: All views and opinions expressed in reader comments are solely those of the individual submitting the comment, and not those of the Pantagraph or its staff.

mds1 wrote on Jun 20, 2008 6:52 AM:

" I'm glad SF thinks it's a good idea to not cancel flood insurance policies, but I wonder why their tune has changed. A few years ago when this area had a lot of flooding of basements, many homeowners were not covered because they weren't in a flood plain. However, most of the flooding was actually sewer back-up because B/N's sewer systems couldn't handle the tremendous amount of rain we had in the 3 hours it came down (about 8 inches of rain.) Fortunately, those who had sewer backup insurance were covered. Unfortunately, 6 months after they paid the claims , they cancelled most people's sewer back up insurance. Now we are left without coverage because of their cancelling that portion of our policy. I've talke dto many other locals who had the same thing happen to them too. It's as if we can't win for losing. Sure buy our insurance, but don't you dare make a claim, or we'll cancel you. "

BNHuman wrote on Jun 20, 2008 5:18 AM:

" Ummmm. I didn't know SF or Country covered flood damage. "

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