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FEMA has done some remapping in our are and we have a farm that is now in a special flood hazard area. It has 4 barns/sheds that are in a flood zone. The loan amount is more than the value of all the buildings. We have had loans on this property for a while. The appraisal has the depreciated cost value of each barn but it was completed in 2014. Can we rely on the appraisal values that are from that far back? Or would it be best to require flood insurance in the amount that they are insured for on their farm owner’s policy?
FEMA standards and appraisal rules list an appraisal as being stale after 1 year. Flood FAQs from May 2022 discuss one method of coverage being replacement cost value which I assume is what is listed on the Farm Policy. Rules also indicate that you would need to align the flood insurance requirements with the Flood rules and your bank’s policy.
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