Jean Charles de Menezes was shot and killed in July as he boarded a train at the Stockwell underground station after police mistook him for a suicide bomber.
The shooting came a day after four men had failed in an attempt to bomb the London underground network and two weeks after four men killed themselves and 52 others in a suicide attack.
Police said on Wednesday that they had reviewed their policy and found it was "fit for purpose". However, they said it could be changed after a separate investigation by the Independent Police Complaints Commission (IPCC) into the Menezes shooting.
Chris Fox, president of the Association of Chief Police Officers, said in a statement: "I am pleased that the existing policy has been deemed fit for purpose and we now await any IPCC recommendations."
"Police officers, faced with a threat, have to identify and assess the threat and manage it," Fox's statement said.
"They must then use only such force as is proportionate in the circumstances, which may be negotiation or the use of force. Where it is absolutely necessary, lethal force might have to be used."
The review said the principles for countering the threat of "suicide terrorism" should be produced in a document available to the public and added that police should engage with communities to ensure the policies were understood.
Police say they must use force
based on the circumstances
Police were heavily criticised after the Menezes shooting, and leaked evidence from the IPCC report has indicated there were major errors in the operation.
The IPCC has submitted its full report to prosecutors to consider whether any officers involved should face criminal action. But details have not been made public.
The police chief group said it produced a strategy for dealing with suicide bombers after the attacks in the US on 11 September 2001.
This was reviewed after 7 July, when four bombers blew themselves up on three London underground trains and a bus, killing 52 people.