Flood insurance scheme fails to go far enough, says MP

It is 100 days since the Boxing Day floods caused misery for thousands of families and businesses across the Calder Valley, York, Leeds and elsewhere in the region.

While the scheme has been hailed as “re-energising” the insurance market, one Yorkshire MP said it does not go far enough to protect all of those at risk - and said more should be done to protect businesses, who have faced hefty premiums in the wake of the deluge.

Flood Re will work with insurance firms so people who own and live in properties that are most likely to flood can shop around more easily. Some households living in flood-prone areas could have a choice of providers for the first time in years.

It is estimated that around 350,000 UK households could benefit - some 39,239 in Yorkshire.

Brendan McCafferty, chief executive of Flood Re, said: “This should make flood cover more affordable and accessible to those in high flood risk areas over time.”

Insurers have put the flood damage bill for storms Desmond, Eva and Frank during December and over the new year at around £1.3 billion, including commercial customers and some vehicle claims as well as domestic property.

So far, more than half of the home insurance market have signed up to offer policies backed by Flood Re, including Admiral, Aviva, Churchill, Direct Line, LV= and More Than.

Rachael Maskell, Labour MP for York Central, said the announcement was a “positive first step” but did not go far enough.

More than 400 homes and 150 businesses in York and surrounding areas were flooded on Boxing Day. Some have seen their premiums and excesses “hit the roof” in the wake of the floods, she said.

She said: “I have been calling for an extension of the scheme to include people living in leasehold properties and to small businesses, who are crying out for a scheme to give them support.

“The scheme will also only apply to properties built before 2009, and that needs to be looked at. It’s a great start but a lot more needs to be done to ensure that everybody has the protection they need.”

Yorkshire Flood Envoy Robert Goodwill told the Yorkshire Post last month that the Flood Re scheme could be used as a model to help small businesses, but warned it would take time to come into effect.

Today’s announcement does not include any provision for small businesses.

Around 400 businesses in Leeds were also affected by the flooding.

The deputy leader of Leeds City Council, Coun Lucinda Yeadon, said she knew of one firm who saw their excess rise from £1,000 to £250,00.

She said: “Big businesses or chains have the security of being multi-national companies but small businesses don’t have that security net and the Government need to be able to provide that.”

She said the Government were “letting down” the legions of small business owners by not providing insurance support for them now - as many have been forced to simply close.

“If they are looking at adding to it in future - it could be too late,” she added.

The Association of British Insurers (ABI) said fully drying out, repairing and restoring a flooded home often costs between £20,000 and £45,000 so buying insurance for properties which are likely to flood a lot often costs more.

Huw Evans, ABI director general, said today marked “the start of a process which will re-energise the home insurance market in flood-prone areas” and help ensure as many people as possible have access to “effective, affordable cover”.

Floods Minister Rory Stewart said affordable flood insurance “will help people get back on their feet more quickly and secure their futures”.

He added: “It is great news that Flood Re is now open for business. It is fantastic step forward - making flood insurance affordable for people regardless of where they live.”

December 2015 was the third wettest December since records began in 1910 - with record breaking levels on the rivers Aire, Calder and Foss. Gorpley in Calderdale recorded 113mm of rainfall in just 24 hours.

Since Boxing Day, the Environment Agency has spent £24m repairing flood defences across Yorkshire.

This includes the removal of collapsed bridges along the River Calder, gravel clearance and thousands of inspections.

Almost 8.500 flood defences have been assessed, with 900 identified in need of repair. Work continues to ensure all are fully operational.

The Environment Agency’s major incident recovery manager, Phil Younge, said: “The floods of December 2015 had a terrible impact on people’s lives, homes and businesses across the county. Many residents and businesses are not yet back in their properties.

“The job we have before us, of getting our defences back in a condition they were prior to flooding, is a huge challenge, but our teams are working tirelessly to restore protection to communities.”