Archive: Wed May 2016

Mortgage Intelligence adviser update: Could Flood Re help your clients?

Head of Mortgages and Insurance Stephanie Charman takes a look at the new Flood Re scheme, designed to help make flood insurance more affordable for those in high risk areas.

Although an agreement was made between the Government and the ABI in 2000 to make flood insurance widely available across the UK, it did not take into account the affordability issues that recent large scale flooding has highlighted for those in high-risk areas.

That is why the Government has launched the Flood Re scheme, created to offer affordable flood insurance to more than 350,000 high-risk homes. Partly funded by a recent increase in insurance premium tax, the scheme went live as of 4th April 2016.

Scheduled to be in place for a full 25 years, a big part of the scheme will be to help people improve their understanding of their own flood risk level and whether they can help reduce the risk by taking action themselves.

So what will Flood Re do?

The government has confirmed that the scheme’s main goals are:

  • Ensure affordable flood cover is available to households at the highest risk of flooding
  • Increase availability and choice, including insurers and products, for consumers
  • Level the playing field for new entrants and existing insurers in the UK market
  • Increase the flood preparedness of authorities, insurers and communities

After some small businesses suffered affordability issues following the latest winter floods, the government is now also looking at a similar scheme to be available for small to medium sized enterprises as well as homeowners.

This is great news for so many clients that may have struggled to get flood insurance for their home or business because of affordability.

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