Large parts of both Northamptonshire and Leicestershire are prone to flooding. You don’t even need to be near a river such as the River Nene or Soar to be affected.
It is apparent that recent large scale flood events have highlighted the impact of severe flooding, including the effect on those who struggle to find affordable home insurance.
Since 2000, flood insurance has been widely available to households at high risk of flooding due to a series of voluntary agreements between the Government and members of the Association of British Insurers (ABI).
These agreements did not cover the affordability of the home insurance provided which has meant ever increasing Insurance premiums. As such, insurance companies and the Government have been working together to develop a different way of dealing with flood insurance. They decided on a ‘flood re-insurance’ scheme – known as Flood Re – to help support households at highest flood risk. An important part of the Flood Re scheme will be to offer help to people to increase their understanding of their level of flood risk and explaining how, where possible, they can take action to reduce that risk.
Flood Re reinsurance is likely to commence business in April 2016 but is not available for many types of property. Properties which are not covered by Flood Re are:
- All commercial property
- All residential property built since 1 January 2009
- All mixed use property
- All purpose built blocks of flats
- Buy-to-let properties where the landlord arranges the buildings insurance
- Most houses that have been converted into flats
These properties will instead be subject to market-driven premiums and excesses for flood cover. For this reason it would be prudent for prospective buyers or tenants of property to establish whether their target property is at risk of flooding and, if so, whether it will fall within the scope of Flood Re. If not, then they may wish to check what flood insurance cover would be available, so as to ensure that its terms and cost will be acceptable.