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My building is located in a Special Flood Hazard Area (SFHA) and the lender told me that I will be required to purchase flood insurance. Can I be exempt from the requirement to purchase flood insurance?

You can be exempt from purchasing flood insurance for a building or mobile home in an SFHA only if

  • the original principal balance of your loan is $5,000 or less and the original repayment term of the loan is one year or less, or
  • the building is a structure that is part of a residential property but is detached from the primary residential structure of that property and does not serve as a residence.

Last Reviewed: April 2021

Please note: The terms "bank" and "banks" used in these answers generally refer to national banks, federal savings associations, and federal branches or agencies of foreign banking organizations that are regulated by the Office of the Comptroller of the Currency (OCC). Find out if the OCC regulates your bank. Information provided on should not be construed as legal advice or a legal opinion of the OCC.

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