Homeowners at risk of flooding are set to benefit from a new affordable insurance scheme, with some able to buy insurance for the first time.
Between 300,000 and 500,000 UK households would struggle to pay for flood insurance without some support, according to the Association of British Insurers.
The new scheme, Flood Re, will extend insurance to some Brits whose homes were previously judged too high risk to insure.
Most homeowners will not see any difference in their insurance. In theory, the scheme is supported by an average £10.50 charge. In practice, flood insurers have been charging this anyway.
We asked the insurer Lloyds to explain:
Who is likely to be affected?
Flood Re makes sure as many homes as possible are able to obtain affordable home insurance that includes cover for flood.
Some people who were previously considered too risky to insure may soon be able to purchase home insurance that includes flood cover.
Who is likely to be able to buy insurance when they couldn’t before?
Every home is different, with its own specific risks. However, some homes that were previously considered uninsurable because they were too high risk may now be able to obtain cover.
Who may see insurance expenses rise and may need to budget for this in future?
Flood Re is designed to ensure that as many people as possible can obtain affordable home insurance that will cover them for flood. The aim of Flood Re is to keep premiums affordable and home insurance available to as many homeowners as possible.
Flood Re is designed to be seamless and the majority of homeowners will not see any big change when this scheme is launched.
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