I have a condo on the 23rd floor in downtown Austin.

I just got a notice from Wells Fargo that it is required to have flood insurance (it is next to a creek). Is that a normal requirement in a high rise? it seems silly to me

Presumably there are common areas on the ground floor or basement that could be damaged in a flood and the unit owners would be responsible for repair? I would still think that would be an HOA duty to insure and then premium gets paid from your dues.

Agreed. Seems like that should be part of the HOA insurance policy.

Condos are a damn racket in any case. Avoid.

Probably just a form letter since part of the building/lot is in the floodplain. The AI does not understand that you are +/- 200 ft above the floodplain elevation.

They require an elevation certificate or some other document to clear it up since the AI and/or person is not able to apply basic logic.

Dr T and the Women said:

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I have a condo on the 23rd floor in downtown Austin.

I just got a notice from Wells Fargo that it is required to have flood insurance (it is next to a creek). Is that a normal requirement in a high rise? it seems silly to me

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Your HOA should have insurance that covers structural.

I'd just ignore it also - if you already have the loan, they can get it themselves.

Forced place insurance is about 4 times the cost of private insurance.

I bought a waterfront house on lake Livingston and got a notice that the previous owner had flood insurance. It's on a hill about 20 feet above the lake. I checked and It's above the overflow level of the dam. It would have to flood all the way from here to Louisiana and then some to reach my house. I don't have a note, so did not buy flood insurance.

Edit 2000 autocorrects.

The are probably simply pulling up the address which is likely in a flood plain and not taking into account what floor you are on. I would just give Wells a call and see if someone can override the request.

It's a condo. He has common ownership of the first floor which is probably a lobby. This wasn't an oversight and there isn't an override.

This is from the National Flood Insurance Program Condominium Coverage information for lenders. And keep in mind a lender that does not get the property coverage cannot deliver a loan to the GSEs.

"Unit owners need to be aware that if, for any reason a condominium association elects to discontinue its RCBAP, individual unit owners may be responsible for covering flood damage. That is why having flood insurance and property coverage is important for all residents living in condominium buildings, including high rise condominiums. It doesn't matter if you live on the first, fifth or tenth floor, every owner has an undivided interest in the common elements of the building and can be assessed for unpaid damages to common areas even if their own unit remains undamaged. Also, condominium by-laws require all unit owners to be assessed for uninsured damages to common areas of a building if damaged by flood."

so how does that work....do you pay a % based on your common ownership?

Don't know that answer, just know you aren't closing a condo purchase without it if required.

One example I was given years ago was about a high rise on Clear Lake. If the property flooded and the elevator was knocked out who is it most important to? The guy on the 23rd floor probably. I did 4 or 5 deals in that development, all on higher floors and all of them groused, but they had to get it.

Someone suggested he ignore this but that's a terrible idea.

I get your point, it would just be odd to me to have a scenario where a condo is covered for flood risk under a master policy, and separately covered by each owner (the ones with a mortgage at least).

great deal for the flood insurance carriers though.

I don't think they have to have both but most of the most of the condo associations with which I'm familiar are trying to push the coverage off on the owners rather than carrying the master policy.

got it.

seems like it's a lot "cleaner" to have it under the master policy and accounted for in the monthly fees.

that way, they know the building is "fully" insured.

When Pointe West got nailed by Ike, it was a bunch of finger pointing. Every policy carrier said they weren't the applicable party and tried to pass the buck.

Probably pretty common.

we called Wells.. I think they don't have the up to date policy from the HOA.. so hopefully that is all it is and it looks like I don't need my own individual flood policy

jja79 said:

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It's a condo. He has common ownership of the first floor which is probably a lobby. This wasn't an oversight and there isn't an override.

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This has nothing to do with getting a personal flood policy for his unit. There is a master HOA policy that covers the building and flood. Flood policies are based on the risk and he cant get a commercial flood policy in his name for the lobby. And getting a flood policy on his unit would have zero coverage or relevance to covering the lobby.

So his lender either needs a copy of the HOA flood policy or he needs to speak with them to get this request corrected.

Now, if his lender is being a stickler he could hypothetically get a flood policy on his unit but keep in mind that only covers flood damage from rising waters for his finish out and contents. If he sustained damaged from rising waters for that then we are in Armageddon.

I understand. I was just speaking to the comment that WF can do anything about the need for coverage even on a unit on the 23rd floor. The GSEs will not take a loan without the proper coverage.