What Is Flood Re? The UK Guide To Flood Re Reveals All
What is Flood Re? To help you understand the Flood Re scheme, its benefits and how you can find more affordable home insurance, we’ve created The UK Guide to Flood Re. Download the free guide today!Get a quote!
What is Flood Re?
Flood Re is a reinsurance scheme which will allow insurance companies to offer more affordable flood cover to those living in high risk areas.
You’ll learn about:
- Flood Re objectives and how the scheme works
- Which properties can and can’t be covered by Flood Re
- How to buy flood risk insurance through Flood Re
- How to create a flood survival kit
- Which emergency services are on hand
- Safety when cleaning up after a flood
- How to make an insurance claim
Ready to put a stop to costly flood risk premiums? Get started with The UK Guide to Flood Re today.
A Total Washout
In recent years the UK has experienced severe winter storms, resulting in extensive coastal damage and widespread flooding.
The insurance industry has paid out billions of pounds as thousands of homes have been destroyed by these flood waters. As a result, many residents have since struggled to find affordable home insurance due to being in a high flood risk area.
Now a new insurance initiative, backed by the Government, launches in April 2016. It is designed to help property owners at risk of flooding to source affordable home insurance. It’s called Flood Re.
Flood Re Key Facts
- It is open to properties within council tax bands A-H.
- It comes into effect in April 2016.
- It is planned to be in place for 25 years.
- Not all insurance providers are taking part in the scheme.
- It is one of the most significant innovations to be introduced to the home insurance market.
- It is designed to enable affordable flood cover for those at the highest risk of flooding.
- Not all properties are eligible for cover.
HomeProtect will work out eligibility when you get a quote, and offer you the best possible level of cover.
What Is Flood Re?
While home insurance has been available to residents living in areas at high risk of flooding, it has not always been affordable.
The risk of flooding is reflected in the price, so in some cases home insurance premiums or excesses have increased. As you would expect, homeowners are not happy about these changes.
In the worst case scenario, residents might have to choose between paying a large sum and not having cover at all.
As a result, the Government and Association of British Insurers (ABI) have worked together to create Flood Re.
"Flood Re is a reinsurance scheme which will give insurance companies the chance to offer affordable flood cover in high risk areas. Although it remains up to each individual insurer to set their own price for flood cover, the reinsurance cost charged by Flood Re is capped by the property’s council tax band.
This will give people access to more affordable flood insurance ensuring that the insurance safety net continues to be in place for the future, even if your property is at a high risk of flooding." -Brendan McCafferty, CEO, Flood Re
Flood Re Objectives
To provide home insurance cover in areas at high risk of flooding
To raise awareness of preventative measures, the different levels of flood risk and what to do in a flood
How Does It Work?
What Do ‘Cede’ And ‘Reinsure’ Mean?
Definition of cede: Give up (power or territory)
Synonyms: surrender, concede, relinquish, yield, part with
Definition of reinsure: To transfer (all or part of a risk) to another insurer to provide protection against the risk of the first insurance
To cede a policy to a reinsurance scheme:
Insurance is a strongly regulated industry. Insurers are required to maintain enough capital as collateral against losses.
Reinsurance allows the insurer to transfer the risk to an external organisation. For example, HomeProtect can reduce its exposure to risk and provide cover to more properties by passing the flood risk on to Flood Re.
HomeProtect Is Working In Partnership With Flood Re
We’re always looking for ways of providing better quality, affordable products for our customers, so we’re investing heavily to ensure that we are able to start ceding policies to Flood Re. -Alex Parker-Walklate, Head of Product, HomeProtect
How Is It Funded?
It is estimated that 350,000 homes could benefit from the launch of Flood Re over time.
To put the Flood Re scheme into effect, the insurance industry has invested £20 million in set up costs.
Ongoing, there will be two sources of income for Flood Re:
The flood part of the premium for policies which are transferred to Flood Re.
An additional annual levy of £180 million from the insurance industry.
Prices Will Vary
The flood element of your premium will be capped based on Council Tax band, so prices will vary according to property type.
Your insurer then adds on other risks, such as fire and theft, to calculate your final price. Your overall premium is dependent on your individual circumstances.
When Flood Re launches in April, HomeProtect will be able to take all of these details into account, and return a quote which will automatically calculate your eligibility for Flood Re cover.
HomeProtect is available 24/7
HomeProtect is available 24/7 and can quote in 98% of cases.
Save the Flood Re launch date in your diary, and be among the first to get an online quote!
Who Will Be Eligible For The Scheme?
So that Flood Re is available for everyone who needs it, properties will only be eligible if they meet all of the following criteria:
- The property must have a Council Tax band A to H (or equivalent).
- The property must be built before 1st January 2009 (if a building is demolished, and rebuilt before this date, the new property is still eligible).
- The insurance contract must be held in the name of one or more individuals.
- The property must be used for residential purposes.
- The property must have an individual premium.
- The policy holder or their immediate family must live in the dwelling for some or all of the time, or the dwelling must be unoccupied.
- Leasehold flats with 3 or less units.
- The property must be located within the UK mainland.
So Who Can’t Be Ceded To The Scheme?
- Bed and breakfast premises paying business rates.
- Blocks of residential flats (Contents cover only).
- Company houses/flats (Contents cover only).
- Contingent buildings policies (e.g. held by banks).
- Farm outbuildings.
- Freeholders/leaseholders deriving commercial income insuring blocks/large numbers of properties in a portfolio.
- Housing association’s residential properties.
- Multi-use under commercial or private ownership.
- Residential ‘buy to let’ (which does not meet the criteria specified earlier).
- Social housing properties (Contents cover only).
- Static caravan site owners (for commercial gain).
How Do I Buy Home Insurance Now?
Essentially, nothing has changed. You don’t need to do anything differently when shopping around for insurance. You will be required to provide personal details about your current home and circumstances, as always.
Use of the Flood Re scheme happens in the background and you will never need to deal with Flood Re directly.
If you come direct to HomeProtect then we will work out your eligibility for Flood Re automatically, and will return a quote based on your individual circumstances.
Making A Claim
Call your insurer as soon as possible after a flood. It’s likely that they will need to make arrangements for a loss adjuster to come to your home.
A loss adjuster will survey the property and confirm any repairs or replacements that are needed and that are covered by your policy.
You should never throw non-perishable items away until you have received clearance from your insurance provider because doing so can adversely affect your flood insurance claim.
Ask Your Insurer
First things first, check your policy documents...
Check your policy to find out which level of cover you have in place. If you are not sure, then you should ask your insurer several questions when making a claim.
Common questions to ask:
- Am I covered for alternative accommodation?
- How long will it be before a loss adjuster can visit?
- Can emergency repairs and water-pumping start without an adjuster's approval?
- Can I make flood defence modifications at the same time as repairs to reduce damage from flooding in the future?
- Will my contents be replaced as ‘new for old’?
- Will I be reimbursed for food that has been spoilt?
- Can you provide or recommend a professional cleaning company?
A Claims Checklist
- Check your policy schedule – you will have received this in your welcome email or updated renewal documents.
- Check your excess – for instance, you might decide not to claim if your excess is more than the damaged items are worth.
- Gather your receipts or invoices which prove the value of any items that you're claiming for.
- Check which items are not covered, as outlined in your policy documents.
- Create an inventory of the damaged items and their estimated value.
- Provide a description of the extent of the damage, and photos where possible.
- When you’re ready to call, have your policy number to hand.
Who Pays The Claim?
Your claim will be handled by your individual insurer as usual. So although you may be reinsured through Flood Re, you should still contact your insurer directly to start the claims process.
Behind the scenes, Flood Re will interact with each insurer who has chosen to pass flood risk into the scheme. Then, the insurers will be reimbursed for any valid claims.
On verification of a successful claim, your insurer will arrange an agreed amount for the property to be restored. Now you can start rebuilding your life with the support you need.
How To Prepare For A Flood
A little investment now can stand you in good stead... If you are at risk of flooding, you can take steps to reduce the threat to your property. Being prepared can also have an effect on your insurance premium, so read on!
If your property is in an area at high risk then the odds are not in your favour. You can still take steps to minimise the damage caused, however.
- Sign up to the Environment Agency's Flood Warnings Direct service. They will keep you in the know!
- Flood risk insurance is a must for homes already known to be at risk, not an optional extra. Check your home insurance cover or get a quote from alternative providers.
- Make a note of where the taps or switches you need to turn off your electricity and gas are.
- Prepare a flood survival kit. Don’t forget to pack copies of your insurance documents, clean drinking water and a torch.
- Make a plan of how to contact your family in an emergency. How will you get in touch? Where will you meet them?
- Move electrical appliances, valuable items and furniture upstairs.
Flooding is possible. This alert will usually be issued a few days before flooding is anticipated. It is when you should prepare a flood survival kit and move valuables or furniture upstairs.
Flooding is expected. If this warning is issued then you should install any flood protection equipment such as toilet bungs, sandbags and flood gates. Shut off your utilities including gas, electricity and water supplies. Make plans to evacuate your family, pets and vulnerable neighbours to a safe place outside of the flood area.
Severe Flood Warning
Flooding is imminent and now poses a serious threat to life. You should stay in a safe place with a clear escape route. Emergency services will be in the area and you should comply with their advice. If you are in immediate danger then always call 999.
Specialist flood protection products can make a huge difference to the state of your home after a flood; they’re well worth investigating if you are at risk.
Airbrick covers can prevent water from entering through walls.
Sandbags can provide useful protection around entrances and windows.
A barrier between the brickwork which seals against the door frame and the bottom step.
Toilet pan seal
Prevents sewage back-flow through the toilet system.
Flood Survival Kit
Research shows 9% have not looked into protecting their home, believing it won’t happen to them.
Preparing a flood survival kit could make all the difference should the worst happen. Here are some essentials:
- Use water-tight containers with lockable lids to store important documents, such as your insurance policy schedule. It’s also recommended to keep digital copies that can always be accessed.
- Vacuum-packing warm blankets, waterproofs and a change of clothes can save space.
- Pack a first-aid kit with waterproof plasters. Remember any important medications you might need!
- Flood water is unsafe to drink so be sure to pack bottled water. You might also pack tinned or dry foods that are easy to open.
- Include a torch and a good supply of batteries, as well as a whistle.
- Emergency cash and passports are also well worth having at the ready.
What To Do When It Floods
Don’t panic. Your safety and the safety of those around you is paramount in this situation.
If a flood warning has been issued in enough time, you should leave your property and take your survival kit as well as any essential items well ahead of the flood waters reaching your home.
If you cannot, as flooding has a habit of happening overnight, then avoid driving and walking through it. Do not try to swim unless you absolutely have to; flood water is really unsanitary and currents can be strong.
Debris is another thing to look out for, as you never know what might be lurking beneath the surface. Avoid injuries by finding a clear path. If you have been able to contact emergency services, then stay on higher levels and wait for rescue.
In severe flooding, don’t try to be a hero. Let emergency services do their job safely.
Keeping Children & Pets Safe
Children and animals are particularly at risk during a flood. Of course they will be frightened – who wouldn’t be when a river takes up residence in your home! – but they may not understand what is happening or know how to stay safe.
If a flood warning is issued in your area then you should make arrangements to evacuate children and pets as early as possible. Not only is it safer for them but it may also be safer for you as you know that they are being looked after. You can concentrate on limiting the damage to your property and belongings.
Don’t let your children or pets play in flood water. Swallowing flood water or mud can cause diarrhoea, fever or abdominal pain.
National Flood Emergency Framework
The UK National Flood Emergency Framework is a Government document which details the level of response to a flood. You can view it in detail online here.
Events routinely handled by local government and the emergency services.
Flooding with local, small scale evacuation, no risk to critical infrastructure. No significant central government involvement.
Severe weather with limited consequences. Floods in more than one county, some displaced persons and potential risk to infrastructure.
The Lead Government Department Minister runs the crisis response with their own emergency facilities.
Has a prolonged impact requiring sustained central government support. Floods in several counties, hundreds of displaced persons, actual disruptions to critical infrastructure.
Response coordinated from Cabinet Office Briefing Room, response may require deployment of wider military resources.
A high impact incident which requires immediate central government direction. Floods affecting significant portions of the country, thousands of displaced persons, serious damage to critical infrastructure.
Prime Minister or Secretary of State leads in the event of a catastrophic incident.
After A Flood
Stay vigilant when returning to your home as flood water can be dangerous. It’s probably still worthwhile keeping children and pets away from the home until it has dried out.
Obvious dangers to look out for include damaged tiles, loose floorboards or skirting boards and exposed nails. As well as that flood water is highly unsanitary. Avoid getting water on your skin and disinfect your hands regularly.
Don’t turn on your gas or electrics until they have dried out and been checked by a qualified technician.
Don’t eat food that has touched flood water, and contact your water company to verify the tap water is safe to use again.
Make sure that you keep the house well ventilated so that air can circulate and allow the property to dry out.
Stay with friends or family, or contact your Local Authority to find alternative accommodation.
Cleaning Up After A Flood
Take photographs before you start cleaning. Notify your insurer before throwing away items that cannot be cleaned, like carpets.
Wear wellington boots and rubber gloves to clean up, and be sure to wash your hands afterwards!
Clean all surfaces including walls and floors with hot water and strong detergent. Surfaces contaminated by sewage need to be disinfected.
Clothing and other fabrics that have been affected by flood water should be thoroughly cleaned. Wash on a 60 degree cycle.
When removing rubbish, place it in skip bins or in rubbish bags away from your home.
Rats can also be an issue. Dispose of dead rats and other pests in a bag, or get in touch with your Local Authority.
You may notice mould growing on damp walls, this should stop as your home dries out but if it persists, contact a specialist.
Top 10 People To Follow On Twitter
- Department for Environment Food & Rural Affairs - @DefraGovUK
- Association of British Insurers - @BritishInsurers
- Friends of the Earth - @wwwfoecouk
- Know Your Flood Risk - @flooduk
- National Flood Forum - @NatFloodForum
- Property Care Association’s Flood Protection Group - @PCAPropertyCare
- Mary Dhonau, Chief Exec, Know Your Flood Risk - @floodmary
- Elizabeth Truss, Environment Secretary, Gov’t - @trussliz
- John Curtin, Environment Agency, Acting Executive Director of Flood and Coastal Risk Management - @johncurtinEA
- Chartered Institution of Water and Environmental Management - @CIWEM
Top 5 Pages To Follow On Facebook
TIP: Try searching for your local community page, like Cumbria Community Foundation
Like and follow HomeProtect on Facebook for the latest news and information on all Flood Re developments!
Defra is the UK Government Department of Environment, Food and Rural Affairs.
The Environment Agency plays a pivotal role in implementing changes nationwide.
The Environment Agency’s section on flooding. From here, you can sign up for flood warnings or quickly check your area by postcode.
The National Flood Forum houses a large community who offer advice to those who are ‘at risk’ of flooding.
A campaign to help raise awareness of the wider flooding issue in the UK and a source of support.
Visit the Flood Re website for an overview of the scheme and its management.