Private Flood Insurance and the National Flood Insurance Program (Nfip) [Updated November 19, 2021] [open pdf - 702KB]
From the Document: "The NFIP [hyperlink] was first authorized by the National Flood Insurance Act of 1968 (42 U.S.C. §4001 et seq. [hyperlink]) and was reauthorized until the end of FY2017 by the Biggert-Waters Flood Insurance Reform Act of 2012 (BW-12; Title II of P.L. 112-141 [hyperlink]). After 17 short-term reauthorizations, the NFIP is currently reauthorized until December 3, 2021 (P.L. 117-43). In statute, Congress has found that (1) many factors have made it uneconomic for the private insurance industry alone to make flood insurance available to those in need of such protection on reasonable terms and conditions; but (2) a program of flood insurance with large-scale participation of the Federal Government and carried out to the maximum extent practicable by the private insurance industry is feasible and can be initiated. (42 U.S.C. §4001(b) [hyperlink]). By law [hyperlink] or regulation, federal agencies, federally regulated lending institutions, and government-sponsored enterprises (GSEs) must require certain property owners to purchase flood insurance as a condition of any mortgage that these entities make, guarantee, or purchase. Property owners are required to purchase flood insurance if their property is identified as being in a Special Flood Hazard Area [hyperlink] (SFHA, which is equivalent to having a '1% or greater' risk of flooding every year) and is in a community that participates in the NFIP."
CRS Insight, IN10450
Congressional Research Service: https://crsreports.congress.gov/