Property Partially in Flood Zone

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    One of our lenders is working up another loan with one of our long term customers. We have used this property with multiple buildings before as collateral and all flood determinations in the past have come back okay – it never showed it was in a flood zone. However, on the most current flood determination, it is now showing one of the buildings on the property is slightly in a flood zone. Are we required to get flood insurance on all buildings located on the property? Or just the one slightly in the flood zone?

    I am new to the world of compliance and would appreciate any help. Thank you in advance!


    You are required to obtain flood insurance on any building or mobile home that secures the loan and is located in a special flood hazard area (100-year flood plain) within a participating community. You would need insurance only on the building slightly located in the flood zone.

    I suspect that the other buildings may be in a 500 year flood plain. You are not required to get flood insurance on properties in a 500-year zone, but insurance still makes sense for properties located in that zone. 30% of the flood damage typically takes place in 500-year zones.

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