Home insurance: Flood-risk properties could be 'uninsurable'

Published 19th Jun 2008

More than half a million homes in England could become uninsurable unless action is taken to protect them against flooding, the insurance industry warned today.

In a report published a year after thousands of homes in Hull were hit by flooding, the Association of British Insurers (ABI) warned that its members could stop offering flood protection as standard on all home insurance policies.

It said insurers could not commit to covering the 517,000 homes identified by the Environment Agency as being at significant risk of flooding, unless the government announced plans for them to be adequately defended.

The ABI said that without government action and stricter enforcement of planning controls to prevent new homes being built on flood plains, some properties could become "uninsurable, unsaleable and uninhabitable".

The group said last year's floods in Hull and Gloucester led to 180,000 claims for flood-damaged homes, businesses and vehicles, and that its members had dealt with four years' worth of claims in two months.

More than 17,000 policyholders were put up in temporary accommodation and a total of £3bn was paid out in claims.

A survey of some of those living in the flood-hit areas found eight out of 10 thought the danger of flooding was increasing, while three-quarters did not think enough was being done to tackle the problem.

Improving drainage was seen as a top priority for 98% of people, followed by tougher planning controls for new homes.

Three-quarters of people believed the government's target of 3m new homes by 2020 should be reduced if it would lead to more homes being at risk of flooding.

Nick Starling, the ABI's director of general insurance and health, said: "These findings reinforce our call for a long-term flood management strategy.

"In particular, we must tackle the problem of surface water drainage. Planning for the future is essential if we are to minimise a repeat of last year's terrible floods, and to ensure that flood insurance protection remains widely available."

A spokesman for the government's communities and local government department said: "If councils properly use the tough new planning rules we have put in place to protect new homes against flood risk, which includes consulting the Environment Agency, it will ensure that all homes are safe from flooding and sustainable for the future - effective surface water drainage and flood defences must also be part of new housing infrastructure."

Hilary Osborne

Source: ' Guardian '

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