building valuations

Homebuyers Warned of Growing Flood Risk

Article in the Daily Telegraph December 2005

By Jessica Brown

Another 2m British properties could soon face steep rises in insurance premiums, writes Jessica Brown

Househunters who want to avoid sky-high insurance premiums should first check the current and future flood risk of a property, insurer More Than said last week.

New figures from the Environment Agency reveal that climate change could send the number of homes at high risk of flooding up from 1.5m to 3.5m.

Environmentalists predict that Britain’s flood damage bill could increase from £950m a year to £3.2 billion unless more is done to protect homes and businesses.

Barbara Young of the Environment Agency said: “Insurers’ figures show the cost of repairing damage from extreme weather and floods has risen 60% since 1998.”

More Than, part of the Royal & Sun Alliance, is worried that the number of people affected by flooding will rise still further if the government allows the 200,000-pus homes planned in food-risk areas to be built.

David Pitt of More Than said: “Building in flood-risk areas should only happen as a last resort.”

November marks the start of the traditional British “flood season”. In recent years, however, certain parts of the UK have also been hit by flash summer floods – such as the one that devastated Boscastle in Cornwall in August last year.

The government has built defences in many high-risk areas and has promised to protect a further 80,000 properties from flood damage this tax year. But many areas remain vulnerable.

People living in the countryside are often left exposed because the government will not pay for defences that protect only one or two homes.

Most insurers are committed to providing flood insurance for existing customers where possible. However, the agreement brokered by the Association of British Insurers (ABI) guarantees cover for properties expected to flood more than once in 75 years only if defences are in place by the end of 2007.

Representatives of the insurance industry and the government meet this week to review progress.

Being unable to get cover can leave homeowners facing a negative-equity nightmare. The Royal Institution of Chartered Surveyors warned last year that homes on flood plains could lose up to 80% of their value without cover.

And those who can get cover often face crippling premium rises. Research by shows that living in a flood area can boost premiums by more than 60%.

Sebastian Catovsky, policy adviser at the ABI, said: “The agreement we have with insurers and the government concentrates on the availability of insurance for people living in high flood-risk areas, not on the cost”.

People living in high-risk areas where no defences are planned may find they can reduce this by investing in their own protection.

Halifax General Insurance has a deal that means customers who install costly Floodskirt protection can reduce their premiums by 20%, and those who prevent flooding by using the technology receive £2,000.

Insurers that have developed their own flood maps also claim they can offer cover to more people and often cheaper.

Richard Mason of Insure Supermarket said: “Switching to an insurer that has adopted a more sophisticated method of assessing risk could save your more than £100 a year. But it might also show you to be a higher risk.”

You can check whether or not your home, or a property you are thinking of buying, is at risk of flooding on the website, which also posts daily flood warnings.

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