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Banks must insure that borrowers purchase flood insurance coverage at least equal to the following minimums:
- Outstanding principal balance of all loans secured by the property;
- The appraised value of the property minus the land value (the improved property value); and
- The maximum insurance available under the principal flood insurance program [generally, $250,000 for a residence and $500,000 for commercial buildings - but this is for each building].
First published on BankersOnline.com 2/17/03