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Home > Frequently Asked Questions > Flood Insurance Required  

Frequently Asked Questions: Flood Insurance Required


Flood Insurance Required 

Program Area

Water Management 

Specific Program


CWCB Section

Watershed & Flood Protection 


When is it mandatory to carry flood insurance?


The Flood Disaster Protection Act of 1973 and the National Flood Insurance Reform Act of 1994 mandate the purchase of flood insurance as a condition of Federal or federally regulated financing for acquisition and/or construction of buildings in Special Flood Hazard Areas (SFHAs) of any participating community. The purchase of flood insurance on a voluntary basis is frequently prudent, even outside of SFHAs. These Acts prohibit Federal agency lenders, such as the Small Business Administration (SBA) and United States Department of Agriculture's (USDA) Rural Housing Service, and Government-Sponsored Enterprises for Housing (such as Freddie Mac and Fannie Mae) from making, guaranteeing, or purchasing a loan secured by real estate or mobile home(s) in a SFHA, unless flood insurance has been purchased and is maintained during the term of the loan.
Created at 6/30/2010 9:23 AM  by System Account 
Last modified at 6/30/2010 9:23 AM  by System Account