As the threats of floods render more than half a million homes in the UK vulnerable, the Association of British Insurers (ABI) has warned that its members may not be continue to offer home insurance cover to such homes.
The trade association issued the warning Wednesday amidst growing concerns about floods, which caused enormous havoc last year with a possibility of a repeat this summer.
ABI said unless the government takes steps to protect the homes from flooding by putting in place adequate defences they may become uninsurable.
It urged the government to adopt a more co-ordinated approach and carry out a thorough assessment of the floods risk, focusing on the problem of overflowing drains.
This advice was based on its calculation that more than half of the 180,000 floods insurance claims its members handled after last summer’s flooding were floods that had been caused by water coming up through drains.
At its ‘Floods – One Year On’ conference at London’s Queen Elizabeth II Conference Centre on Wednesday, the association said its members had agreed to offer cover to the endangered properties at a price that reflects risk, providing the government puts adequate floods defences in place.
But the ABI warned the insurance premiums could become unaffordable if the risk increases substantially.
The ABI’s director of general insurance and health, Nick Starling said that insurers would have paid out £3 billion following the floods of last summers, adding that their customers share their concerns for the future.
“Planning for the future is essential if we are to minimise a repeat of last year’s terrible floods, and to ensure that flood insurance protection remains widely available,” he added.
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