Homes, flooding and insurance – we look at Flood Re

Homes damaged by floods UKThe Flood Reinsurance Scheme known as ‘Flood Re’ began in 2016 and is designed to ensure that households in areas at high risk of flooding are able to obtain affordable home contents and buildings insurance.

The not-for-profit scheme covers around 350,000 homes in the UK and was introduced following government intervention to guard against households in flood prone areas being unable to afford or obtain home insurance. At the moment, Flood Re is scheduled to finish in 2039 although it is possible it may continue after this date as more insurance providers and homes use the scheme.

Flood Re works by insurance companies selling on the risk of insurance to other insurance providers, which spreads the risk away from a single provider. A levy of £180 million a year is paid by insurance companies to fund Flood Re. The home owner deals with their own insurance company and any losses to the homeowners insurer is recovered by them from the scheme. Not only are the premiums still affordable, but the excess is also capped, currently at £250 per claim.

The scheme should also cover motor vehicles with fully comprehensive motor insurance.

Tenants’ contents insurance can also be covered by the scheme, but you should check with your insurance company. You should also find out if your landlord’s insurance has Flood Re cover, which could help towards re-housing costs should the worst happen.

Is every home covered by Flood Re?

There are several cases where your home may not be covered by Flood Re:

  • Not all insurance companies have signed up to the scheme so policy holders should check that their insurer is covered by Flood Re.
  • Only homes built since 2009 are eligible, which is meant to discourage housebuilders from building homes in flood prone areas.
  • The Flood Re scheme covers domestic properties only, which could well be an issue if your home is also your business. If your home attracts business rates it won’t be covered.
  • Flood Re only covers property that is lived in by its owners (all or some of the time) or rented out to immediate family members.

Check the Flood Re register to see if your property could be covered and make sure your insurance provider is signed up to the scheme.

Read our article: Why are we still building homes on Britain’s flood plains? Just say ‘NO’!

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