Scheme helps flood hit home owners get insured

There is at last some good news for homeowners affected by flooding

Monday 4th April sees the launch of the Flood Re scheme which should enable people who live in areas susceptible to flooding to get cheaper home insurance. But research by home insurance expert Admiral suggests more needs to be done to educate those affected as only one in seven of us have heard of the scheme.

To mark the launch of Flood Re, Admiral surveyed 1,000 homeowners about their views on flooding and its impact. It found that despite two thirds (67%) believing severe flooding events will become more frequent in coming years, fewer than one in seven (15%) said they worry about their own home flooding.

Relatively few people surveyed (7%) said they have suffered a flood*in the past, but it’s clear that for those that were, it was devastating. Admiral asked them the worst thing about their own flooding experience. The highest number (21%) said the destruction of their furniture and carpets while 16% said it was the emotional stress it caused.

What was the worst thing about your home flooding?

  1.     Destruction of furniture and carpets - 21%
  2.     The emotional stress - 16%
  3.     Destruction of electrical items - 12%
  4.     Raw sewage in the house and its smell - 9%
  5.     Dealing with insurance claim - 9%

Head of Household at Admiral, Noel Summerfield, said: “Although Flood Re won’t prevent flooding, it is good news for homeowners who have been previously flooded or who have had difficulty getting insurance because their home is at risk of flooding.  However our research shows only 15% have heard of the scheme. Flood Re works by charging all home insurers a fee and it’s this fee along with other charges to insurers using the scheme that pays for any associated flood claims.”

 “The Environment Agency estimates that one in six homes are at risk of flood in England alone. Most experts agree that incidents of flooding are likely to become more commonplace, so perhaps those considering buying a home should do more research around the risk of flood.

Not everyone Admiral surveyed would be put off buying a house if there was a risk it might flood, only 62% said they would never consider buying a home that was at risk of flooding, no matter its price.

12% said they would consider buying a home if the price it was up to 30% below its true cost. While 29% would do it if they could get up to 50% off its true cost

However a house that is prone to flooding was ranked as the issue most likely to put off a home buyer. 78% of those surveyed said it would definitely put them off buying a house, ahead of being in a high crime area, which would put off 77%.

Which of the following would put you off buying a house?

  1.     Prone to flooding - 78%
  2.     In a high crime area - 77
  3.     Being next door to very noisy neighbours - 71%
  4.     Subsidence - 70%
  5.     Next to a homeless hostel - 62%
  6.     On a busy main road - 57%
  7.     Near to a prison - 49%
  8.     Previoulsy used to sell drugs - 48%
  9.     Students next door - 47%
  10.     Someone had been murdered there - 44%

According to the Association of British Insurers, insurance companies paid out £1.3bn in flood claims last year and the average cost of a claim was £50,000. So who do people think has responsibility for preventing homes from flooding in the first place? According to those surveyed by Admiral the main responsibility lies with the UK government (59% said this), 57% said it lies with the Environment Agency.

Who do you think has responsibility to try and prevent homes flooding?

  1.     UK Government - 59%
  2.     Environment Agency - 57%
  3.     Local Gov - 54%
  4.     Building developers - 51%
  5.     Homeowners who live in areas prone to flooding - 26%

Noel Summerfield, said: “Some people have been with the same insurer for many years paying very high premiums often coupled with high excesses.  If customers at the highest risk of flood are unsure if they can save money then we’d encourage them to shop around and even consider switching insurers before their renewal.”

For more information on the scheme visit the FloodRe homepage or read our guide on how FloodRe works and if it can benefit you

* Not including burst pipes or problems with an appliance or the mains water supply but rather water entering the home from outside.