Fannie Mae and Freddie Mac’s US regulator is pushing to allow for cheaper roof insurance coverage on mortgages backed by the companies, but the rule change also leave many policyholders in the lurch when they need to make a claim, industry watchers say.
Homeowners will only have to purchase “actual cash value” insurance coverage for roofs—typically paying out smaller amounts for repairs, reflecting property wear and tear—rather than “replacement cost value” that will still be required for everything but roofs, under new rules announced this month by the Federal Housing Finance Agency.
The loosening of insurance requirements is part of ...
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