Ocean City officials tackle mobile home insurance crisis affecting year-round residents

Ocean City officials are grappling with a pressing issue regarding mobile home and manufactured home insurance that could significantly impact local residents. During a recent government meeting, concerns were raised about insurance companies ceasing to provide full replacement value policies for older mobile homes, particularly in high-risk areas like Ocean City.

Currently, many insurance providers, including the Maryland Joint Insurance Association, are only offering policies based on the actual cash value of these homes. This shift poses a major hurdle for homeowners seeking conventional mortgages, as banks typically require insurance that covers the full replacement value of a property. The cash value of older mobile homes is often only a fraction of what it would cost to replace them, leaving many owners vulnerable if their homes are damaged or destroyed.

In Ocean City, there are approximately 1,277 mobile and manufactured homes, with 1,500 located in Montego Bay, the largest residential area for year-round residents. The issue is particularly acute for long-term residents who may lack the financial means to rebuild or repair their homes. The market value of these mobile homes is largely determined by the land they occupy, complicating the mortgage process further, as banks still mandate replacement value insurance on the structures.

The local government recognizes the urgency of this situation and is committed to addressing it. Officials expressed a desire to engage in discussions that could lead to solutions, emphasizing the importance of supporting residents who contribute to the community. As the dialogue continues, the focus remains on finding ways to ensure that all homeowners in Ocean City can secure the necessary insurance to protect their investments and maintain their homes.