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Drowning in flood claims

Flood in a house

As if things weren’t hard enough for the thousands of people whose homes were flooded or destroyed by the winter storms, they face likely increases in their insurance premiums at their next renewal.

Insurers were quick to reassure those affected by the storms that they will be covered under the terms of their current policies, but the Association of British Insurers has warned there is nothing to stop premiums going up in future.

One solution is Flood Re, an insurance scheme agreed last year by the government and insurers, which will give cover to 500,000 households in the worst affected parts of the country.

Footing the UK’s flooding bill

This would be subsidised by every household in Britain paying into a £180m annual pot. But the scheme won’t come into effect until 2015, when it becomes law as part of the Water Bill, leaving many homes in the interim with no access to affordable home insurance.

And there are some glaring issues with the new scheme. Under the current proposal, Flood Re will exclude many homes, chiefly those in the top council tax band or built since 2009. Properties that flood too often or are deemed too high risk would also be omitted.

There is further discomfort for those who do qualify for it, with one government study estimating that the Flood Re fund has a 58% chance of going into deficit in the first 20 years. However, something is better than nothing.

With thousands of homes affected by the floods, especially over the Christmas period, the message from flood victims to the Government is clear – help is needed sooner rather than later.

Are you in a flood risk area? If you have a question about flood insurance, ask it in the comments below and we’ll do our best to get it answered.


I have mixed views on this. If you choose to live in an area known to be at risk from flooding, in a house built on a flood plain, for example, then your insurance premium should be based on that risk. I fail to see why others should subsidise it. If you are flooded because of freak conditions, or if you have lived a long time in a safe area that has, because of a change in flood protection, become affected then that is quite different.

Lynn says:
28 January 2014

I live on a flood plain but my 250 year old house has never flooded. When asked for my post code no insurance company will consider giving me a quote for contents insurance. This means I am unable to move from my existing policy and have therefore to accept their steeply rising annual premiums, I am also unable to opt out of flood cover. To penalize all householders in a huge postcode cover regardless of risk seems unfair.

This is not acceptable. The first half of the postcode can cover a vast area, only the second part can narrow it down to a specific locality and even that can be affected dramatically by topography. The second part of our postcode only covers about twenty properties but there is a height difference of about twenty metres between the highest and the lowest. I have heard good reports of NFU Mutual – they might not be the cheapest but I think they are conscientious over risk assessment and have a good reputation for customer service; they are also more in tune with the countryside.

Pete Lorton says:
31 January 2014

Whilst I have great sympathy for those affected by the flooding, I chose high ground and object to having to subsidise their insurance premiums.