FDIC FAQs – How does a bank determine insurable value?

Compliance > Lending > Flood > FAQs
Q:  How does a bank determine insurable value?
 
A:    A reasonable, consistent valuation method should be used, such as an appraisal based on the cost value (not market value), a construction-cost calculation, or the insurable value from a hazard insurance policy.   Other reasonable valuation methods can be used as long as they can be supported.
 
 
 
ADDITIONAL INFORMATION:
This Q&A was included in the FDIC’s Flood Insurance Videos, which were updated in 2016, which may be found here:   https://www.fdic.gov/news/news/financial/2016/fil16018.html
 

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