pledges to spend billions of pounds on flood defences
won’t necessarily shield householders against rising
insurance costs in flood-hit areas of the country, despite
the protection they offer.
Around £23m of defences were completed in June in the
Northumberland town of Morpeth after major floods in 2008
and 2012 wrought devastation. Yet some householders near the
river Wansbeck still face massive and sometimes rising
Labour MP for Morpeth, Ian Lavery, has raised the issue
in parliament, citing the case of resident Christine Telford
who was quoted between £3,000 and £4,800 for insurance
cover, with an excess of £7,500, despite never being flooded
or making a claim. “Insurers should acknowledge the
[defence] investment and give people living alongside the
river access to reasonable premiums,” he says.
Tim and Suzanne Pinkney, meanwhile, saw their premiums
rocket by 500% after floods wrecked their Morpeth home.
“They shot up from about £250 a year for contents and
buildings to £1,500 with an excess of thousands of pounds –
that was seven years ago,” Tim says. “After several years
with no claims our premiums fell, only to rise again this
year despite flood defences being built in the town.”
The couple, who live with their sons Max, seven, and
Toby, four, found themselves “chest height in water” when
their two-bedroom house flooded in 2008. “It was dreadful –
we had two hours warning before the water hit, but were out
at the time,” Tim says. “By the time we got home we had
about 10 minutes to move the furniture. In the end we were
rehoused for about 10 months while our home was repaired,
with our claim totalling around £70,000.”
The Pinkneys have stuck with their insurer Churchill.
“Nobody else will insure us, but we were frustrated when our
premium rose suddenly this year after more than five years’
no claims – we got it down to around £780, but that’s only
because we’re a long-term customer,” he says. “And we had to
strip the policy to its bare bones to do so.”
Churchill says: “The flood defences in the Pinkney’s
vicinity have only recently been upgraded, but our models
are regularly updated using the latest Environmental Agency
data. However, as we have seen in Carlisle, flood defences
can still be overcome and the property may still be at some
risk of flooding.”
The experience of Morpeth residents reflects the problem
of finding reasonable cover for the thousands of homes in
flood-risk areas in the UK – and the growing scale of the
issue. The past decade has seen a series of devastating
floods, with Storm Desmond the latest to leave thousands
homeless in Cumbria and Lancashire.
There are calls for more to be done to protect vulnerable
householders from huge premiums as they rebuild their lives
in the aftermath of floods. Paul Cobbing, chief executive of
National Flood Forum, says the situation in Morpeth is
unacceptable. “Any flood defences need to be put on to the
national database, but this isn’t being kept up to date,
which is a big problem,” he says.
The ABI says insurers should take into account measures
that reduce the risk to a property, such as flood defences.
But as James Dalton, director of general insurance, says:
“In order to do so, the protection which new defences offer
needs to be included on flood risk maps. In the meantime,
homeowners can request a letter from the Environment Agency
which they can provide to their insurer as evidence.”
A spokesman for the agency says it will provide Morpeth
residents with such a letter to explain the impact of the
Cobbing says there should be greater access to reasonable
premiums ahead of
Flood Re, which is set to come into force from April
2016. This government scheme will pool the flood risk
element of buildings and contents policies to pay out future
claims, placing a cap on the amount insurers can charge
customers for the flood element of their policy.
One explanation for recent premium rises experienced by
those in flood-risk areas could be that this winter will be
the last in which insurers face the costs of the worst
flood-related claims. The other factor impacting premiums is
insurers’ use of new flood-mapping technology, aimed at
highlighting areas at risk “down to the individual
property”.Under current rules insurers are obliged to offer
cover to existing customers who have previously been flooded
or are at risk of flooding under an agreement called the
statement of principles, set by the Association of British
Insurers and the government.
Around 5 million, or a sixth of properties in England,
are considered to have a higher than normal risk of
flooding. At least 350,000 are considered high-risk and will
benefit from capped insurance costs under Flood Re.
Up to 9,000 new homes are scheduled for development by
local councils on land the Environment Agency says is at
either “serious” or “significant” risk of flooding,
according to Greenpeace, making a scheme to ensure there is
cover available particularly vital.