---
title: "Flood Insurance: The Why"
description: Understand why flood insurance is crucial for borrowers and how it protects the federal government, not just financial institutions, in our latest blog post.
---

[Banker's Compliance Consulting Blog ](https://blog.bankerscompliance.com/en)

# [Flood Insurance: The Why](https://blog.bankerscompliance.com/en/flood-insurance-the-why)

 Written by [Kevin Edwards](https://blog.bankerscompliance.com/en/author/kevin-edwards) | Apr 23, 2025 2:04:31 PM

If you are new to lending, you will learn (or maybe you already know) there are times when you must require a borrower to purchase [flood insurance](https://www.fema.gov/flood-insurance/work-with-nfip/manuals#flood-insurance) to get a loan. What you may not know is “why” you have to require flood insurance. Flood insurance is not about protecting the bank, it’s about protecting the federal government. In a sense, financial institutions have been deputized and tasked with making sure the rules are being followed.

Kevin explains more in the video.

 

Published  
2025/04/23

[View full post](https://blog.bankerscompliance.com/en/flood-insurance-the-why)

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