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The cost of my flood insurance policy has increased. I would like to increase my deductible to reduce the cost of flood insurance. Is this possible?

It may be possible. You would need to discuss this with your lender.

A lender should take into account the risk that an increased deductible would pose to the borrower and lender. Lenders should determine the reasonableness of the deductible on a case-by-case basis. It is not a sound business practice for a lender to allow a borrower to use the maximum deductible amount in every situation.

A lender should not allow the borrower to use a deductible amount equal to the insurable value of the property to avoid the mandatory purchase requirement for flood insurance.

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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