This is fantastic news for the industry and, more importantly, for the thousands of homeowners who will benefit from it.
Every year we see tragic stories on the news of homes destroyed by floods and livelihoods ruined. Insurers have worked hard with the government to come to an agreement that will help those people most at risk to secure affordable, effective home insurance and all parties should be applauded for the work they have put in. But we must remember this is not a long-term, catch all solution. More needs to be done in terms of flood defences to ensure the risk of flooding for homeowners is minimal.
When George Osborne announced plans to hike Insurance Premium Tax once again in this year’s Budget the blow was only softened by the fact the money used will be spent on flood defences. The insurance industry wants to protect those people at risk. Greater collaboration is needed between the government and associated agencies to tackle the problem.
Planning laws must also play a part. As the Association of British Insurers rightly pointed out in its briefing on Flood Re last year 20,000 new properties are built on flood risk areas each year, including 4,000 a year in areas of significant flood risk. This can’t continue.
The introduction of Flood Re is a good first step but I think we need to remember that it is only that - the first of many steps needed to ensure the safety of homeowners across the country.
