Court Upholds Dismissal of Flood Insurance Lawsuit

The South Dakota Supreme Court says a Hermosa woman cannot sue a lender for failing to make sure her home was covered by flood insurance.

Court documents say Rachelle Hunter signed a document indicating she needed flood insurance when she borrowed money from Highmark Federal Credit Union to buy a home in 2005. Her home was damaged by a flood in 2007.

Hunter then sued the credit union, arguing it was negligent in failing to make sure the home was covered by flood insurance.

The Supreme Court on Thursday upheld a lower court’s decision to dismiss the lawsuit.

The high court says federal flood insurance law does not give people a right to sue lenders in such a situation.