Can I purchase private flood insurance instead of an NFIP policy?

No, private flood insurance will not satisfy FHA’s National Flood Insurance Program (NFIP) flood insurance coverage requirement. The Department of Treasury published a final rule, effective July 1, 2019, that allows their regulated lending institutions to accept private flood insurance in lieu of an NFIP policy; however, this does not change FHA regulations.

Flood insurance coverage exceeding FHA’s NFIP flood insurance coverage requirement can be obtained. 

If FHA decides to make any changes to policy in this regard, any proposed or final rulemaking will be published in the Federal Register with an opportunity for public comment. 

HUD Policy Determination

All policy information contained in this knowledge base article is based upon the referenced HUD policy document. Any lending or insuring decisions should adhere to the specific information contained in that underlying policy document.

Topic Number: KA-05309