Creek running through property - liability? Insurance?

Question

I have a shot at purchasing a property that is partly in a flood zone and has a creek running through the property. I am waiting on my insurance agent to respond but I'm trying to get an idea of the liability of this and how insurance sees it. Is it like having a pool where there's a lot of liability on the landowner? I can't really fence off the creek. Obviously I know that I'm dealing with a wet basement etc but I'm more concerned from a liability standpoint. Anyone have experience or insight?

Thanks

Bruce Woodruff · Answer

If you are getting financing then @Andrew Postell is correct. If you're paying cash, then it's up to you....I just bought a house allegedly in a 'flood-zone'. Lol, it's in the middle of the desert and there is a wash about 1/4 mile away...heck, there are washes everywhere. But in reality you can walk the area and see that it will probably never flood. Ever. Flood insurance is only $800 per year so why not...?

Regarding your creek, the issue is really (as you know) that someone will fall in and get injured (or drown). I would definitely, 100%, get a good level of liability insurance if you're going to have it as a rental, and even more if it will be a STR, where people will be on vacation and probably partying.

Andrew Postell · Answer

@Karolina Powell it's more simple than even what you are describing.  Your mortgage company dictates your insurance requirements.  So, if your lender requires flood insurance - then you have to get it.  If they don't - then it's optional.  They base their decision on the "flood certificate" or "flood cert" and either your insurance company or your lender can check this for you.  That's it.