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Insurance fears over 200,000 homes in flood peril
Around 200,000 homes at risk from flooding could struggle to get insurance from next year, the industry has warned.
The Association of British Insurers (ABI) said an existing deal with the Government that safeguards flood insurance for high risk properties expires in 2013 and time was running out for on-going talks about a new safety net arrangement.
Almost 17,000 homes at risk of flooding in Hull and more than 4,000 in the Leeds Central parliamentary constituency could be affected.
Otto Thoresen, director general at the ABI, said: “Insurers want to make sure that every home has access to affordable insurance, should the worst happen, and we’re concerned that those people most at risk in areas like Hull will lose out unless we make progress in our discussions with the Government about a long term sustainable way forward.
“We are frustrated with the progress of our talks with the Government on this issue and want it to look urgently at our suggestions to allow flood cover to remain widely available and competitively priced. “
He added: “No country in the world has an entirely free market providing universal affordable flood insurance without government support, and action is needed now to avoid 200,000 high risk homes struggling to afford cover.”
The warning came as MPs raised concerns over whether there will be enough money to maintain and improve flood defences to protect millions of at-risk homes in the future.
Samantha Baden, property analyst at FindaProperty.com, said the failure to renew the agreement could wipe up to 15 per cent – an average of £32,600 – from the value of properties in affected areas.
The Public Accounts Committee also warned it was unclear “where the buck stops” for managing the risk of flooding, as the Department for Environment, Food and Rural Affairs (Defra) has said it is not ultimately responsible for the issue. Defra told the committee it shares responsibility for flooding with the Environment Agency and local bodies, but the MPs warned the department had no way of knowing if local flood management was adequate and when it should step in. The costs of flood damage currently stand at around £1.1 bn a year.
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Saturday 26 May 2012
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