Not Knowing What You Don’t Know
Sellers who aren’t in a flood plain and disclose that to prospective Buyers have no problem.
Meanwhile, Sellers who are in a flood plain and disclose that are also typically fine: Buyers might not like the added 
insurance expense, but they see it as a trade-off for a coveted lake or river view/setting (if they don’t feel that way . . they’re not the Buyer).
And they know about the extra expense up front, before they make an offer.
So, what’s one of the most common pitfalls concerning flood insurance?
Sellers who ARE in a flood plain, but who are unaware of that.
That’s most often the case with an older, long-in-place Seller with no mortgage on the home.
Tripped Up By Underwriting
What often happens in such scenarios is that the home sale progresses, umm . . . swimmingly up until the point that the Buyer’s lender does their due diligence, and discovers the flood plain issue.
Unsurprisingly, Buyers aren’t thrilled about what can be an extra $2k (or $5k!) annual insurance expense (the premiums have been rising steeply).
Some deals get past that hurdle . . . some don’t.
The moral for savvy agents?
Better to proactively determine a home’s flood plain status, especially one that’s on or near a body of water.
Even if the client is clueless.
P.S.: the other common issue regarding flood insurance is a prospective or in-process change in a home’s flood plain status, either because the homeowner is appealing the designation, or, the flood zone has been re-drawn (done every decade).
