HOMES that are flooded for the first time can expect their insurance premiums to treble to nearly £1,000 if they make a claim.
The Environment Agency says more than 1,800 properties have been flooded since the start of the year. And with the UK Health Security Agency issuing a weather alert to all homes until midday on Friday, the number claiming for damage to their home and property for the first time is expected to be in the thousands.
More than 3.4 million properties in England are at risk of flooding, according to the agency.
The average annual cost of home insurance rose to its highest level – £315 – last year, according to trade body Association of British Insurers (ABI). It means for those who get flooded, typical premiums could soar to close to £1,000 a year.
The ABI says on average it costs £33,600 to repair a flooded home and that recent storms, starting with Storm Babet in October, have led to £352 million in claims.
Matthew Bloodworth in his flooded home opposite Tewkesbury Abbey in Gloucestershire, after Storm Henk hit the UK last week
Fields on the outskirts of Gloucester were under water yesterday as days of stormy weather and heavy rainfall across the country took their toll
Anna McEntee, home insurance expert at comparison website Compare the Market, agreed that climate change – including floods – is likely to be a factor in the hike to home cover costs for those forced to claim.
She says: ‘Living near bodies of water could increase your home insurance premium, given insurers may view it as a bigger flood risk. But you could shell out even more money if your home is not adequately insured. It is definitely worth shopping around to get the best deal.’
Research by Money Mail has shown that in some cases households have already seen the price of buildings and contents policies as much as triple, with ‘weather patterns’ – including the risk of flooding – given as a key reason. This is even before making a claim.
Barbara Penhallow saw her annual home premium with Axa-owned Swiftcover rise from £178 to £542 for her £500,000 house in Croydon, south London, last year. She was told ‘floods and unexpected storms’ were contributing factors.
Online boutique owner Helena Adams, 66, saw cover for her £575,000 property in Harrow, north-west London, soar from £291 to £687 with insurer Esure, with a letter saying: ‘Following changes to weather patterns, we have reviewed the risk associated with your property.’
Insurer Axa admits a ‘huge range of factors’ are considered when calculating annual premiums, including floods, unexpected storms and cold snaps. Aviva says ‘severe weather’ is a contributing factor while Admiral says ‘future weather, such as flooding and storms, are factored into our pricing methodology’.
Research company Consumer Intelligence found that home insurance quotes rose on average by 26 per cent last year – with ‘wetter winters increasing flood claims’.
Insurance companies are expected to use the recent downpours and storms as an excuse to hike premiums for those forced to claim.
A children’s playground in Quarry Park, Shrewsbury, was flooded after the River Severn burst its banks when Storm Henk hit the UK last week
The Government’s Flood Re scheme aims to make homes more affordable for those who live in a high flood risk area, but it typically covers only properties built before 2009.
While the scheme enables homeowners to take out insurance, with prices linked to their council tax band, the number of insurers offering cover is limited. Flood Re also has a Build Back Better scheme offering up to £10,000 for homes to better protect their property against future flood damage.
Separately, following Storm Babet in October, the Government is encouraging flood-hit property owners to apply for up to £5,000 as part of a Property Flood Resilience Repair Grant Scheme.
Heather Shepherd, director of operations at charity National Flood Forum, believes such support does not go far enough and fears it enables the insurance industry to exploit homeowners with unnecessarily high premiums.
She says: ‘There are bound to be new people making claims this year – and they are going to be in for a nasty surprise.
‘We have a never-ending battle with the Government to come up with a better plan to tackle flood risk properties. Insurers are not a charity so you can expect them to profit from floods. But I would much rather they pushed the Government to support homeowners.’
Two cars were left abandoned in a flooded car park near the Thames River in Oxford, on Sunday after a week of heavy rainfall saturated the country
James Daley, of consumer website Fairer Finance, believes climate change should already be factored into premiums – and that insurance hikes often have little to do with the weather.
Consumer duty rules were introduced two years ago by the Financial Conduct Authority to stop insurers exploiting loyal policyholders with higher premiums than those paid by new customers. Although the regulations were well intentioned, since their introduction insurance costs have risen across the board.
Louise Clark, general insurance policy adviser at the ABI, says: ‘Insurers expect bad weather to strike at any time. The priority right now is to help any affected customers recover as quickly as possible.
‘If you have been affected by flooding, contact your insurer as soon as you can and they will be able to offer help and advice.’
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