Flooded home

Homeowners could struggle to insure flood-risk properties

Tens of thousands of flood risk homes face rocketing insurance costs – or problems even getting covered – due to the looming expiry of a government pact guaranteeing flood cover.

Experts have warned that the agreement – which obliges insurers to provide cover for high-risk properties as long as the Government improves flood defences – runs out in June 2013, creating uncertainty for the 34,000 homes at risk of flooding in Kent.

A report by the Association of British Insurers (ABI) flagged up three areas with the most homes at significant risk; Folkestone and Hythe with 7,196, Sittingbourne and Sheppey 4,295 and Canterbury 4,199.

Others areas have lower numbers, such as Maidstone with 1,109, Ashford 813 and Tunbridge Wells 340.

The ABI warned that with the flood pact ending next year, a new sustainable solution needed to be urgently agreed to avoid thousands of homes struggling to get insurance cover.

MP for Folkestone and Hythe Damian Collins said the current agreement should be reviewed in terms of an extension.

But he criticised the insurance industry for forcing unfair charges on his constituents.

“The Government continues to invest in sea defences, but this is not reflected in customers’ insurance bills,” he said.

“There are two things we need to do; the first is to continue to invest in sea defences. People are pleased to see the completion of defences at Dymchurch and we are pushing for investment for defences in Romney Marsh.

“The second thing we must do is put pressure on insurance companies not to overcharge customers and where sea defences have been completed this should be reflected in bills.”

Mr Collins said he has called a meeting with environment minister Richard Benyon to discuss the matter.

Spokeswoman for campaign group Defend Our Coast Brigitte Bass said the organisation had frequently pointed out that properties in flood risk areas would face insurance problems when the agreement ran out.

“Some people may find it impossible to get insurance for their properties,” she said.

“Hythe is one of those areas with ‘significant risk of flooding’ and defined as a ‘greater than one in 75 chance of flood in any given year’.

“Unfortunately this risk applies not only to Hythe but to many other parts of the Romney Marsh where the present standard of sea defence has been identified as low as one in five.”

She added that while the Dymchurch defence was welcomed, unless other protection was put up at Romney Marsh it would have little impact.

“Rural areas are being left behind. If you look at Sandwich, which has more money and a denser population, there is investment.

“The need to improve or complete outstanding sea defences schemes on the Marsh is now greater than ever - not only to protect lives and to keep our communities safe from coastal flooding, but also to ensure that we are given an equal chance to insure our homes in the future.”

Mr Collins said a planning application had been submitted for a coastal defence in the area.

The AA, which provides home insurance, has urged the Government to take decisive action to ensure all homes are able to get protection and insurance.

A spokesman warned that insurance companies were growing concerned at the number of claims made due to extreme weather such as flooding.

He also warned that some insurers were advising people with flood-risk homes that they may not be able to renew their cover later this year as it would extend beyond June 2013, when the agreement runs out.

ABI’s director general Otto Thoresen said: “We are running out of time to make sure that people in high risk areas are properly protected from the devastation flooding can cause and the ball is now in the Government’s court.

“Insurers want to make sure that every home has access to affordable insurance, should the worst happen, and we’re concerned that those people most at risk will lose out unless the Government considers a safety net.”

A group of MPs on the Public Accounts Committee said this week it was unacceptable that local people should be left in doubt and that flood protection should be a national priority.

The Department for Environment, Food and Rural Affairs (Defra) said minister Richard Benyon had met with the insurance industry to make sure flood cover remained widely available and to discuss what additional measures might help safeguard the affordability of flood insurance for households.