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I applied for a mortgage loan, and the bank is forcing me to buy flood insurance. Can the bank do this?

If your home is located in a Special Flood Hazard Area (SFHA) in which flood insurance is available under the National Flood Insurance Act (NFIA), then any federally regulated lender will require you to purchase flood insurance before you get a mortgage.

Flood insurance is available through the National Flood Insurance Program (NFIP). You may also purchase flood insurance through private insurance companies, which sell policies through their network of agents.

Even if your home is not located in an SFHA, a lender may require flood insurance. Any such requirement is a matter of contract between you and your lender.

Refer to 42 USC 50 "National Flood Insurance Act."

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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