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#1998589 - 02/26/15 10:12 PM 2 building apt. complex flood ins. calc.
Chocaholic Offline
Gold Star
Joined: Aug 2005
Posts: 443
Northwest
I am having a real brain fog today- just want to make sure I have this correct..

We have a loan on these buildings and both are in a flood zone.

A. The owners happen to live in one of the units. Even so, because both structures are 10 + units I am calculating max. flood ins coverage at 2 x $500k or $1mil correct?

B. 2 buildings are worth approx. $900 k with land value around additional $600k

C Loan amt. is $750,000

By my calculation & understanding then, the flood insurance should be for the loan amt. ( $750,000 ) divided equally on each building. Is this correct?

The policy I have now is $250k and there is no indication both buildings are covered..so a violation in my books.

Any help will be appreciated.

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Flood Compliance
#1998638 - 02/27/15 02:06 PM Re: 2 building apt. complex flood ins. calc. Chocaholic
Dan Persfull Offline
10K Club
Dan Persfull
Joined: Aug 2002
Posts: 47,018
Bloomington, IN
Maximum available coverage under the NFIP for other residential property is $500,000 for each structure located in a SFHA.

You will need to do a bit of research to see if the one building that is used as the primary residence is eligible for replacement cost coverage. I don't recall if the RCV for a primary residence is based on a 1-4 or simply based on the use of the structure.

The other structure would require actual cash value.

If you only have $250,000 coverage on one building then you are under insured.
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The opinions expressed are mine and they are not to be taken as legal advice.

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#1998777 - 02/27/15 04:53 PM Re: 2 building apt. complex flood ins. calc. Chocaholic
rlcarey Offline
10K Club
rlcarey
Joined: Jul 2001
Posts: 80,341
Galveston, TX
RCV is limited to a principal residence:

Principal Residence. A single-family dwelling in which,
at the time of loss, the named insured or the named
insuredís spouse has lived for either 80% of the 365
days immediately preceding the loss, or 80% of the
period of ownership, if less than 365 days.
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The opinions expressed here should not be construed to be those of my employer: PPDocs.com

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