[Code of Federal Regulations]
[Title 7, Volume 11]
[Revised as of January 1, 2003]
From the U.S. Government Printing Office via GPO Access
[CITE: 7CFR1806.21]

[Page 1163-1164]
 
                          TITLE 7--AGRICULTURE
 
    CHAPTER XVIII--RURAL HOUSING SERVICE, RURAL BUSINESS-COOPERATIVE 
SERVICE, RURAL UTILITIES SERVICE, AND FARM SERVICE AGENCY, DEPARTMENT OF 
                               AGRICULTURE
 
PART 1806--INSURANCE--Table of Contents
 
                   Subpart B--National Flood Insurance
 
Sec. 1806.21  General.

    Authority: 7 U.S.C. 1989; 42 U.S.C. 1480; 40 U.S.C. 442; 42 U.S.C. 
2942; 5 U.S.C. 301; delegation of authority by the Sec. of Agri., 38 FR 
14944 (7 CFR 2.23); delegation of authority by the Asst. Sec. for Rural 
Development, 38 FR 14944, 14952 (7 CFR 2.70).

    Source: 39 FR 17093, May 13, 1974, unless otherwise noted.


    (a) Authority. This subpart prescribes the policies and procedures 
to be followed in implementing the National Flood Insurance Act of 1968 
as amended by the Flood Disaster Protection Act of 1973. The provisions 
of these Acts are applicable to Farmers Home Administration (FmHA) or 
its successor agency under Public Law 103-354 authorities permitting 
financing of buildings of any type now located in or to be located in 
special flood or mudslide prone areas as designated by the Federal 
Insurance Administration (FIA) of the Department of Housing and Urban 
Development (HUD), and any machinery, equipment, fixtures and 
furnishings contained or to be contained therein.
    (b) Background. The Congress has found that annual losses throughout 
the nation caused by floods and mudslides are increasing at an alarming 
rate, largely as a result of the accelerated development and 
concentration of populations in areas subject to floods and mudslides. 
The availability of Federal funds in the form of loans, grants, 
guarantees, insurance and other forms of financial assistance are often 
determining factors in the utilization of land and the location and 
construction of industrial, commercial and residential facilities.

[[Page 1164]]

    (c) Scope. The National Flood Insurance Program (the program) was 
authorized and created because the private insurance industry has been 
unable to provide insurance coverage at reasonable prices for such 
natural disasters as floods and mudslides. Subsidized and affordable 
insurance has been made available under the Act through an agreement 
between the Federal Insurance Administration and the National Flood 
Insurers Association.