The UK Insurance industry has experience large losses from Flooding in the recent past and as a result of this, many insurers are reluctant to offer cover in the worst affected locations. Governemnt pressure has so far resulted in two Flood Insurance assistance facilities in the UK:
Household Insurance – Flood Re
In April 2016 the UK Government, with the backing of British insurers launched the Flood Re scheme. This is a fund backed by the Government and the insurers specifically set aside to meet flood claims from house owners where the general insurance market is refusing to provide Flood Cover.
Subscribing Insurers will issue policies excluding Flood cover but will also arrange a Flood policy with Flood Re for which a separate premium will be payable by the policyholder.
This facility is not presently available for let properties or blocks of flats but it is intended to offer relief to the 350,000 most at risk households in the UK.
Small to Medium Enterprises - BIBA (SME) Scheme.
In December 2016 the BIBA announced their SME commercial Insurance scheme.
“Designed to include flood cover for many commercial properties and let properties located in areas at risk from flooding.”
This is an arrangement managed by R&Q Commercial Risk Services and backed by Lloyds of London.
BIBA believe it will provide their members with a practical solution for many of their clients in flood risk areas where flood cover is not available on the general market.
The Scheme will be using advanced mapping facilities and will recognise effective flood damage mitigation measures.
Unlike the Flood Re arrangement there are as yet no promises with regard to availability of cover or any commitment to premium levels but these may emerge as the scheme is rolled out.