Insurers warn of premiums rise due to floods
July 18, 2007 by admin
Filed under News, News-Insurance
Home insurers warned yesterday that premiums might increase across the board due to their being hit by claims from the recent floods in the North.
People living in homes which have been flooded before will be hardest hit by the increases, although most will have to pay slightly more as the industry responds to the apparently quickening frequency of extreme weather in the UK.
The recent floods follow the flooding in Eastern England in 1998 and the deluge at Bocastle in the west country three years ago. Most policies are currently calculated on a once-in-75 year risk.
David Ross at Norwich Union said that “modest” premium increases would take effect, although he also pointed out that, in a competitive market, the cost of home insurance “has remained level” over the previous decade.
A spokesperson for the AA said that “extreme weather conditions” will “become more common” due to climate change.
A price comparison website reported earlier this week that the number of people taking out home insurance cover had risen by 300 per cent in flood-affected areas this summer.
The Association of British Insurers (ABI) also announced that it would work more closely with councils to help plan emergency responses to natural disasters in the UK and lobby for extra government money for flood defences.
