According to Stevens, a federally-regulated lender would require a would-be borrower living in a high-risk flood zone to buy flood insurance in order to qualify for a mortgage loan. The required insurance amount “would at least have to cover the amount of the loan” claims Stevens.
A homeowner should buy flood insurance if he or she resides "in a known flood plain with no failsafe controls,
like a dam," contends Pete Gorman, vice president and regional manager of the Alliance of American Insurers,
based in Illinois. "It's a good idea to protect the biggest investment that most people would ever own," Gorman asserts.
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