Bill for losses from floods could be more than £100 million

It has been estimated that the bill for the losses that were suffered in the recent and devastating floods in Cumbria could come to more than £100 million, according to a recent report. Hundred and homes and businesses were affected after flood defences failed to provide protection when rivers burst their banks in Cumbria, Dumfries, and Southern Scotland, causing devastating levels of damage and huge losses. Read more

Tags: finance, scotland, Insurance, Disaster_Accident, weather, environment, insurance providers, Association of British Insurers

‘Homeowners protected from acts of god’

Building and contents insurance can help protect homeowners from the effects of climate exchange, according to the head of risk and underwriting at esure home insurance.

Mike Pickard states that the recent earthquake and increasingly frequent extreme weather conditions can see homeowners “rely” on their home or buildings insurance policy.

The head of risk and underwriting also states that measures can also be taken to help protect homes in the event of severe weather, such as flooding.

“There is no quick fix for flood damaged properties and the destructive power of water can turn lives upside down and damage personal belongings beyond repair”, he explains. Taking precautions and being prepared for the unexpected, whenever it should strike, is crucial.”

Research released by esure also revealed today that nine in every ten adults would not by a property if it had previously been flooded.

Following the earthquake in February, esure said that “a bout of extreme weather can strike at any time and in any street across the UK with devastating effects”.

Tags: Financial economics, water, Esure, United States, flood, god

Home insurance market remains competitive

Prices in the home insurance market are still competitive despite predictions that flood damage claims earlier this year would inflate premiums, according to the British Insurance Brokers’ Association (BIBA).

Graeme Trugdill, technical services manager at the organisation, commented: “Home insurance is still ultra-competitive and you see during any advert break on TV, companies saying we will be your cheapest home insurance option. It is still very competitive.”

Although many thought the flooding would hit home insurance consumers hard, he insists there are still some good deals out there.

He advises those looking for cover to seek advice from an independent source to compare the best ones available.

According to a BBC Panorama programme, in the three months up to July 23rd this year, rainfall was over double the average for that time of year.

Furthermore, it reported that 60,000 homes were hit by the summer’s floods, with the environment agency stating that the chance of London’s flood barriers being overwhelmed by flood is currently at 0.05 per cent.

Tags: Financial economics, British Insurance Brokers, flood, weather, London's flood barriers, cover, environment agency, Business and Economy

ABI calls for increased help with flooding problems

June and July of this year saw heavy rains and bad weather really take their toll in some areas of the UK, causing billions of pounds worth of damage to home and resulting in rocketing numbers of insurance claims that have cost the insurance companies dearly.

Claims for damage to home have been flooding in since June, and insurance companies have had to pay out millions of pounds each in some cases to cover the cost of the claims.

The Association of British Insurers is now calling on the government to provide increased protection against future flooding, stating that although the government has planned to put aside funding for this problem around £150 million more is needed to minimize the risk of this situation arising again in the future.

Stephen Hadrill, director-general of the ABI, stated: “The scale and impact of the floods has been massive. The cost to the industry of over 60,000 claims is approaching £3bn and more claims continue to come in.”

In a letter to the Environment Secretary, Hillary Benn, the Association of British Insurers stated that some drains and watercourses were blocked as the result of poor maintenance.

The letter stated: “Some defences will have been put under great pressure in recent events and will need to be checked and possibly strengthened.”

The ABI also stated that “an urgent review is needed of how best to maintain urban and rural drainage”. 

Mr Hadrill said that this should include “whether expenditure is adequate, and how to co-ordinate better modelling of flood risk and planning of alleviation measures.” A number of areas of England were particularly hard hit in June and July as torrential rain caused major flooding across the country. As a result of the claim levels from the flooding insurance companies have had to hike up rate by up to 10% in some cases.

More info: www.abi.org.uk/floodinfo

Tom Smith
5th September 2007

Tags: Insurance, flood, abi, british, rain

Flooding costs to affect insurance premiums

The UK has seen some of the worst rain and floods in years over the past few weeks, and for many this has resulted in severe damage to their property and huge insurance claims.

Many insurance companies have been inundated with claims following the flood damage, and millions of pounds worth of claims have had to be processed and paid out. Insurance companies have stated that the level of claims coming in has been high and the payouts have made a big dent.

The recent flooding is said to have been the worst in the UK for around sixty years, with many households devastated by the damage caused. A number of leading insurance companies are now stating that they will have to push the cost of premiums up because of the level of claims that have had to be paid out as a result of the flood damage. Both contents and buildings insurance cover is now expected to rise as a result of the situation.

One of the leading insurance companies in the UK, Norwich Union, has confirmed that its premiums will be going up. From next week those taking out cover with the insurance giant can expect to pay around 10% more than previously. All customers will be affected by this price increase and not just those that were hit by flood damage and had to therefore make a claim on their policies.

One insurance company official stated: “People are spending more on home improvements. When things go wrong they’ve got flat-screen televisions and expensive flooring. So, when the do damage, it’s costing us more.”

An official from Direct Line insurance stated: “We do recognise that premiums will rise, and that goes for all RBS brands.”

Tom Smith
19th September 2007

Tags: cover, increase, claim, Insurance, flood, premiums

Flood claims could hit £1 billion

According to industry professionals the cost of flood related insurance claims in the UK could top the £1 billion marks, after thousands of people were left to deal with the horrific damage caused by the torrential rain and storms over the past week or so.

Many areas of the UK have been particularly hard hit by the weather, with consumers suffering the misery of seeing their homes and belongings wrecked as a result of serious flooding. With more bad weather to come it is thought that the estimated cost of claims could still keep on rising.

The average claim for flood related damage in the UK is likely to be between £15,000 and £20,000 according to analysts, and with thousands of people submitting claims for such high amount, insurance companies are going to have to deal with huge payouts.

Ultimately, this is likely to push up the cost of insurance premiums for the future state some experts, which means that all consumers with home insurance will end up suffering financially.

Another factor that claimants should take into account apart from the rise in premiums is that the time taken to process their claims is likely to be far longer than normal simply due to the sheer level of claims currently pouring into insurance offices.

The Association of British Insurers has been offering advice on its website for those affected by flood damage to enable them to make their claim as quickly as possible. One ABI official stated: ‘If you have been affected by flooding, contact your insurance company. Their priority is to deal with all claims as quickly as possible.’

Each year there are, on average, just over 13,500 claims to insurance companies as a result of flooding. However, last week there were nearly 9,000 claims made in one day alone according to report estimations.

Tom Smith
13th July 2007

Tags: flood, cost, companies, car, consumers, home, weather, Insurance, damage, british

Insurance claims expected to flood due to flooding

The recent wet weather in Britain has devastated many homeowners all around the country, causing millions of pounds worth of damage collectively and causing untold stress and inconvenience.

According to officials the level of insurance claims is set to soar as homeowners assess the level of damage that the flooding has caused. This June has been reported as the wettest on record, and many areas throughout the country have suffered huge levels of damage.

A spokesman from the Association of British Insurers: ‘These events highlight just how important insurance protection is. If you have been affected by flooding, contact your insurance company. Their priority is to deal with all claims as quickly as possible.’

The Association of British Insurers has called upon the government to increase the funding for its defenses against flooding.

In the meantime, many of those without insurance cover or with inadequate levels of cover will be suffering the financial costs of the flooding, as they will have to foot the bill for the damages caused by the weather themselves, which could costs thousands upon thousands of pounds.

Even those with insurance cover have to now go through the laborious task of assessing the damage and making a claim with their insurer, which could take time to sort out given the number of claims that are likely to be flooding in.

More unpredictable weather is expected over the next few weeks, and this means that the number of claims being made could rise, which could mean further costs to insurance companies and a higher level of claims from customers. 

Tom Smith
10th July 2007

Tags: weather, home, claim, cover, flood

Protect yourself from flooding

Homeowners across much of England and Wales have endured flooding in recent days and Halifax Home Insurance is offering advice to those who live in high-risk areas.

The insurance firm says that around five million Brits live in flood-risk areas and these people are advised to take action to prevent their home and the items inside it being consumed by water.

Weather experts are predicting more rain in the coming days and Halifax is urging homeowners to follow its advice.

The firm says that homeowners should place sand bags outside doors and windows before a flood strikes.

It also advises that pipes should be protected in case appliances move during a flood, furniture should be moved upstairs and insurance policy information should be kept close to hand in case a claim needs to be made.

Halifax also has some advice for those who have already been affected by flooding.

They are being told to ensure gas, water and electricity supplies have been checked before being switched back on.

In addition, all affected appliances should be thoroughly checked by a qualified engineer, doors and windows should be opened and redecorating should not begin until the property is completely dried out.

It is possible to find out if you live in a flood-risk area by contacting the Environment Agency Floodline.

Tags: home, Wales, Atmospheric sciences, flood risk areas, Halifax Home Insurance, homeowners, firm