There’s good news for the hundreds of thousands of households in flood-prone areas when it comes to buying insurance for their homes.
Changes to a Government scheme set up to make sure cover is available for all flood-threatened homes will mean more affordable premiums from next year.
What is ‘Flood Re’?
The scheme, known as Flood Re, was set up in 2016 and provides back up for insurers so that, if required, they can pass on the flood-risk element of a policy to the scheme.
Flood Re then reimburses the provider if they need to pay out for a flood-related claim.
Insurance costs to come down
It does this in return for a fixed re-insurance price, which is set to be reduced from January 1st 2019. The cost reduction is expected to be passed on to the consumer in the form of lower annual home cover premiums.
Although the exact figures aren’t known yet, the Insurance Times recently reported that the savings could be significant.
Reductions of up to 33%
It expects the price of buildings cover to come down by around and eighth (12%), and contents cover by a third (33%). This could mean a combined policy could cost anywhere between £44 and £112 less a year, saving householders thousands in the long run.
Experts from the Flood Re said that after analysing the scheme’s financial costs over the period since it was set up it had decided it was in a position to charge insurers less.
Consumers should still shop around
The chief executive of Flood Re, Andy Bord, said he was delighted to announce that they’re helping make cover more affordable, and that “If some households in flood-prone parts of the country have previously not taken out home insurance for cost reasons, we hope that this move may encourage them to obtain cover.”
Mr Bord sensibly also pointed out that “Consumers should always shop around to get the right deal for them.”
Our customers are at the heart of everything we do, so we’re always abreast of the latest trends in the home, so we can support you better. We have a team of experts with a real passion for making sure people get the cover that’s right for them. For more information, you can call our experts on 0330 0600 600 or visit www.policyexpert.co.uk/contact for more ways to reach us.
Published 23rd October 2018