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Flood Re – A port in the storm?

The recent storms could have caused damage costing insurers £363 million in insurance claims, according to the Association of British Insurers (ABI).

According to research firm Consumer Intelligence, Home Insurance premiums are on the rise by a national average of 2.9% over the course of the last year. The biggest increase of 4.7% applies to the South East, but this owes more to issues such as higher crime rates than the effects of storms Ciara, Dennis and Jorge.

Written by Paul Brown on 30th March 2020

Flood Re – A port in the storm?

The recent storms could have caused damage costing insurers £363 million in insurance claims, according to the Association of British Insurers (ABI).

According to research firm Consumer Intelligence, Home Insurance premiums are on the rise by a national average of 2.9% over the course of the last year. The biggest increase of 4.7% applies to the South East, but this owes more to issues such as higher crime rates than the effects of storms Ciara, Dennis and Jorge.

Many home policyholders have benefited from Flood Re, a joint initiative between the Government and insurers which was introduced in 2013 to make flood cover more available and more affordable for domestic properties. Flood Re charges insurance companies a fixed premium for the flood element of home insurance for properties built in 2009 and prior and those homes covered by the facility will not necessarily see an increase in premium, due to flooding, at renewal. 

However, damage from the storms that wasn't caused by flooding is estimated to make up £149m of the total and may have an effect on future domestic premiums whilst commercial insurance premiums for businesses, which are ineligible for Flood Re, are likely to increase in flood affected areas.

Source:

https://www.abi.org.uk/news/news-articles/2020/03/insurance-pay-outs-to-help-customers-recover-from-storms-ciara-and-dennis-set-to-top-360-million/

https://www.consumerintelligence.com/articles/turbulent-weather-causes-rise-in-home-insurance-prices


 

 

 

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