If the applicant is in a special flood hazard area, or if the disaster damage was caused by flooding, it must have flood insurance before we can disburse a loan. If the applicant was legally required to maintain flood insurance but did not, then the SBA will not make a disaster loan.
The amount of insurance required is the insurable value of the property in the special flood hazard area but not to exceed the maximum flood insurance available under the National Flood Insurance Act.