Home Insurance and Flooding

Dealing with flooding has put insurance companies in deep water with the Government.

Dealing with flooding has put insurance companies in deep water with the Government, but they have finally agreed a compromise solution for homeowners in flood risk areas.

The problem is no Government agency has official responsibility for dealing with anti-flood measures and homeowners are very much on their own when it comes to protecting their property.

Recent legal guidance has shown that even when a council or Government agency takes action to reduce flooding that fails; homeowners cannot sue for compensation because they ultimately have no responsibility to act anyway.

insurance companies take the view that serious flooding is not insured as an ‘act of God’, which means they are not responsible for unpredictable and unpreventable natural disasters.

But an ‘act of God’ has been held in court to be an event of Biblical proportions, like the Pacific Tsunami rather than a period of heavy rain.

The upshot of all the arguing between the insurance companies and the Government is insurers have agreed to cover homes in flood risk areas providing the Government is making some efforts to reduce the flooding risk there.

insurance companies will only offer cover to homes that have less than a 1 in 75 risk of flooding.

The chance of flooding is classified in to three categories:

• Significant: means a chance of more than 1 in 75 of flooding
• Moderate: Less than a significant chance of flooding, but more than a low chance
• Low: a chance of 200 to 1 or less of flooding

Many people think of flood risk in betting terms – 1 in 75 is the same as a horse having a 75 to 1 chance of winning a race. It doesn’t mean the horse won’t win, but the odds are it won’t.

Similarly, if your home has a 75 to 1 chance of being flooded, it doesn’t mean it will but the chances are it might at some time.

Low percentages have less chance of flooding in any one-year. Higher percentages run more of a risk.

If you don’t already know, you can tell if your home is at risk of flooding from online maps at the Environment Agency (http://www.environment-agency.gov.uk/homeandleisure/37837.aspx).

Finding flood risk cover may be hard if you are in a high-risk area, but you can take some steps to make your home a better risk:

• Lay concrete floors with tiling on downstairs floors rather than wooden floors
• Install plastic or other water resistant materials for kitchens rather than MDF or chipboard
• Consider mounting boilers and electrical points above the flood level
• Avoid sewage back-up by fitting one-way valves

The Association of British Insurers estimates protecting a large home from flooding can cost £20,000 or more. Taking the precautions above can cut the cost of repairs by up to 80%.

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