18:53 PM, 2nd May 2012, About 9 years ago
The likely results of losing flood insurance are sinking-in to landlords with at risk property as much of the country lies underwater and weather forecasters predict even more rain.
Great swathes of England are coping with the deluge -and the heavy rains have highlighted just how many homes and businesses are in danger of flooding.
For months, insurance firms and the government have squabbled about providing cover for homes as the current ‘statement of principles’ comes to an end.
The statement basically says home insurers will offer cover homes and businesses, providing the government spends money on maintaining and upgrading flood defences.
The current agreement ends in June 2013 – and insurers have threatened to pull cover as the government has slashed spending on flood protection as an austerity measure.
Landlords with homes in flood risk areas could pay more or lose their insurance from July, as policies written from that date will cover the date the agreement ends.
The likely result is home insurance costs will soar or buy to let properties will become uninsurable, which could knock thousands off their value as banks and building societies will refuse to lend to prospective buyers.
Association of British Insurers director Nick Starling told delegates at a recent British Property Federation conference: “Insurers are determined that flood insurance remains as widely available and as competitively priced as possible after the current agreement with the government ends in June next year.
“This can only happen if the government agrees with the industry a new, long-term and sustainable flood insurance model – and the need for that agreement is urgent.
“The current agreement is well past its best-by date as it distorts the market for both consumers and insurers. This is why we need a new approach, based on some form of pooling arrangement, to ensure that flood cover remains available to those at higher risk”
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