Flood Insurance Needed? Manmade Lake, Building not in Flood Zone

5 Replies

I googled for the answer but didn't find much.

I'm looking at a set of three duplexes nearby a manmade lake.  The buildings clearly are not in the flood zone but part of the parcel is.

The loan will be a commercial loan, not a Fannie/Freddie backed loan.

Will the bank require I have flood insurance?  I will of course ask them but also looking for some input from the community....

Just to add to what @Jason Bott said, it's also my understanding that if the property is in multiple zones, unless the actual building is in the flood zone, you should be fine.  But the lender may have different requirements for their commercial loan, so up to them.  Also, check out your insurance requirements before making a commitment as well because these days, some insurance companies around here are declaring their own surge zones or flood zones and either not insuring within them or the rates are extreme.    

@Lynn M., @Jason Bott

The response I got from my lender was as follows:

  • If any portion of the parcel is within a flood zone, flood insurance will be a requirement.
  • If a survey is carried out and shows that the footprint of the improvements (buildings) are not in the flood zone, the requirement for flood insurance can be mitigated/waived.

Thanks for your input.