Prohibition on disaster assistance for households above 120 percent AMI for failure to obtain flood insurance
If you are living in a SFHA otherwise known as the 100 year flood zone and are earning more than 120 percent AMI you should be able to afford your flood insurance no matter if you are required to purchase flood insurance or not.

By Murray Wennerlund published 5-18-2022 updated 5-18-2022

IV.E.2.b. Prohibition on flood disaster assistance for households above 120 percent of AMI for failure to obtain flood insurance.

When a homeowner located in the floodplain allows their flood insurance policy to lapse, it is assumed that the homeowner is unable to afford insurance and/or is accepting responsibility for future flood damage to the home. Higher income homeowners who reside in a floodplain, but who failed to secure or decided to not maintain their flood insurance, should not be assisted at the expense of lower income households. To ensure that adequate recovery resources are available to assist lower income homeowners who reside in a floodplain but who are unlikely to be able to afford flood insurance, the Secretary finds good cause to establish an alternative requirement.


The alternative requirement to 42 U.S.C. 5305(a)(4) is as follows: Grantees receiving CDBG-DR funds are prohibited from providing CDBG-DR assistance for the rehabilitation/reconstruction of a house, if (i) the combined household income is greater than either 120 percent of AMI or the national median, (ii) the property was located in a floodplain at the time of the disaster, and (iii) the property owner did not obtain flood insurance on the damaged property, even when the property owner was not required to obtain and maintain such insurance.