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#607253 - 08/30/06 05:28 PM Flood insurance - dealer floorplan
Denny Offline
Member
Denny
Joined: Jun 2002
Posts: 79
Pa
We do automobile dealer floorplan lending. Some of these auto dealership's could possibly be in special flood hazard area. What are our responsbilities as far as requiring the dealer to purchase flood insurance on the automobiles we are financing for him? Can we only require the dealer to obtain flood insurance on the auto's if we also have a loan with that dealer that's secured by the building in which the dealership is located and the building is found during our flood zone determination to be in a flood area? If the dealership building is in a flood area, can we only require flood insurance to be purchaed for the value of the automobiles that are displayed inside the dealership building or could we also require the insurance to be purchased for the value of the auto's displayed on the lot outside the dealership building?

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Lending Compliance
#607254 - 08/30/06 05:36 PM Re: Flood insurance - dealer floorplan
Edr55 Offline
Gold Star
Edr55
Joined: Jul 2005
Posts: 455
From a S&S standpoint, you can require flood insurance whenever (and on whatever amount) you determine that it would be beneficial to protect your interest in inventory collateral.

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#607255 - 08/30/06 05:39 PM Re: Flood insurance - dealer floorplan
Dan Persfull Offline
10K Club
Dan Persfull
Joined: Aug 2002
Posts: 46,765
Bloomington, IN
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The opinions expressed are mine and they are not to be taken as legal advice.

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