A bill is making its way through the legislature that would require insurance companies to allow homeowners to purchase “stated value” policies. The bill was written by Belle Chasse Republican Representative Jacob Braud, who says it would essentially allow homeowners to purchase coverage that matches the value of their homes.
“If your house is appraised for $100,000, you could insure it for $100,000 or less, or any amount there. So you could say, ‘Look, I just want $50,000 of insurance,'” Braud said.
Braud says his bill would apply to those who have mortgages on their homes; those with homes that are paid off can insure them for any amount.
“If you have a mortgage on the house, then, you would have the option to seek an insurance policy that would insure you for your assessed fair market value,” Braud explained.
Braud acknowledges that there is risk involved in buying too little insurance under his bill. That’s why he included an educational component to it.
“We amended the bill to include that, an educational component, to understand the risk of this. I mean, it was a big part of the amendments toward the Department of Insurance would do that, and definitely educate people of the risk of this,” Braud said.
The bill passed in the House last week on a vote of 79-20. It now heads to a Senate committee before it’s heard on the Senate floor, should the committee approve it.
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