how to insure a house in a flood area
Getting affordable home insurance hasn’t always been easy if you live in a high flood risk area. If your home is more likely to flood, insurers either charge higher insurance premiums or do not provide cover at all.
What is Flood Re?
Flood Re is a scheme between insurance companies and the Government to make flood cover more widely available and affordable for home insurance.
Insurance companies need to insure themselves against significant losses in the event of flooding. Insurers buying cover is known as ‘reinsurance. Insurers pass on a portion of the risk and cost for flooding to Flood Re.
Flood Re is a not-for-profit fund that’s publicly answerable, controlled, and operated by the insurance industry.
How does Flood Re work?
We have signed up for Flood Re, so we may use the scheme to protect part of your home against flood damage. All of this will happen behind the scenes.
Claiming for flooding
Flood Re doesn’t change how you claim in the event of a flood. You don’t claim with Flood Re, and we will manage the claim as usual. The only distinction is that insurers can then recoup their costs from Flood Re.
Who pays for Flood Re?
Every year, all insurers offering home insurance in the UK must pay into Flood Re.
Flood Re also charges each insurer a fixed premium when it accepts a flood risk based on your home’s council tax band. Flood Re also has a standard excess of £250 for every policy.
Combined, this raises approximately £180m every year for ‘flood insurance’ covering the flood risks in home insurance policies.
You can find out more about how this works and who pays for Flood Re here.
Does your home qualify for Flood Re?
The Flood Re scheme only pertains to properties constructed before 2009. The aim is to discourage developers from building homes in flood-prone areas. Holiday lets, properties owned by buy-to-let landlords, commercial and leasehold properties are also excluded, as well as homes in the Channel Islands and the Isle of Man.
Flood Re is only intended to last for 25 years and will end in 2039 because, by then, insurers should be managing flood risks differently.
It’s essential to be aware of the flood threat to your property or any property you’re thinking of buying or renting. You can find out the flood risk of a property using the Government’s flood risk checker.
If you’re buying a new build home, ask your developer if they’ve invested in any flood reduction measures. Plus, consider getting a full buildings survey, which should include any flood risk.
More information on Flood Re
Although you’re not required to do anything to access Flood Re, you can find more information about the scheme and advice on how to tackle flood risks on the Flood Re website.