As you probably already know, the flood rules have this quirky requirement that says you need to obtain flood insurance in an amount sufficient to cover the lesser of three things: 1) the principal balance of the loan (or loans if there are multiple properties secured by the property); 2) the “insurable value” of the property (this is a complicated topic); or, 3) the maximum insurance available under the National Flood Insurance Program ($250,000 for most residences and $500,000 for most non-dwelling properties).
Remember this “lesser of three” meets the regulatory coverage requirement. However, that doesn’t always mean you end up with adequate coverage from an insurance or safety and soundness standpoint.
Listen to the video as Dave walks you through a scenario on how to determine the amount of flood insurance coverage and what that could mean if a flood loss is incurred.
These are just the types of flood insurance topics that we will cover in our two-part Flood Insurance webinar series on March 19th & March 26th. We will walk you through flood insurance from A to Z in plain English and help demystify these complicated requirements. See you then!