Hope For Flood-Risk Homes

A new agreement has provided at least a little hope for those living in flood-risk areas.

As any household in Yorkshire, Gloucester and other parts of the UK still living with the aftermath of the unprecedented rainfall of 2007 will testify, flooding is now a fact of life in Britain, irrespective of the season .

But while things only look to get worse as extreme weather conditions increase in the decades to come, there is now at least a little hope for those living in flood-risk areas -- in the form of a new agreement struck between the Government and UK insurers.

Until recently, a dark cloud had loomed on the horizon in the form of the old deal -- the Statement of Principles.

This stated that insurers had to go on providing flood cover to households as long as the State continued to go on investing in flood defences, but there were concerns that as they felt that the Government was not pulling its weight, and failing to make sufficient investment, the cover offered could dry up.

Last week, however, the Government and insurers announced that they have now reached a new agreement to ensure continued insurance for flood-risk homes.

Under the agreement, insurers will guarantee to provide protection to any property deemed to have an annual probability of flooding no more than one in 75 -- or 1.3 per cent.

This means that insurers will offer cover to new customers at moderate risk and existing customers at significant risk --although the deal that depend on the Government delivering improvements to flood defences within five years.

At the same time, the Government has committed itself to a long-term 25-year strategy to improve flood defences.

According to Environment Minister, Phil Woolas, the Government is looking at coastal flooding as well as river flooding and surface water flooding to ensure the increased investment in flood defences is sustained in the long term.

The Government also wants to ensure the planning system will stop inappropriate development in flood-risk areas.

So what does all this mean for homeowners in flood risk areas?

In recent years, we have seen insurers reassess what they consider to be flood-prone areas by increasing premiums -- prompting mounting concerns that the industry will simply refuse to insure homeowners in high-risk areas.

However, the new agreement will mean that flood insurance will remain widely available, plus low-income households will receive more help getting access to cover.

That said, while those who have not claimed for flooding should still be able to get competitive cover from a wide variety of providers, you may find it harder to find affordable and competitive cover if you have, at any stage, made a claim for flood damage.

Nonetheless, even if this is the case, you must still shop around to get the most competitive premium from the handful of providers who are still prepared to insure you.

Ensure you are adequately insured

To ensure you are fully reimbursed for any losses, you need to shop around for a policy with comprehensive protection.

It is vital that you are comfortable with the level of cover on both buildings and contents, and that you are aware of limits on claims and the excess.

You may well find that if you already have a policy with an insurer, that firm will be happy to continue offering that cover, even if the risk grows in the area where you live -- although you may face higher premiums.

That said, if you live in a property which has a risk of flooding which is greater than "one in 75", you could still face rejection from most insurers -- particularly if there are no plans in place for local flood defences.

One option is to approach the British Insurance Brokers' Association (BIBA) which has worked with broker members to provide a facility that can cover the majority of flood prone properties which have previously been refused cover.

At the same time, you may now find that insurers are prepared to offer improved premiums to those who take action to make their homes more resilient against water.

If a flood warning is issued, there are a number of steps you need to take:

         place sandbags outside doors and windows to reduce the amount of flood water entering your property

         turn off gas, electricity and water supplies

         move possessions, furniture and valuables upstairs

         prepare an emergency kit including food, drink, warm clothing, first aid kit, torch and candles

         keep your insurance documents in a waterproof plastic bag

What to do once the waters have subsided:

         contact your insurer and report any damage caused to buildings and contents as soon as possible

         take photos or video record of the damage as evidence and mark the wall to show the depth of flooding

         your insurer will confirm the level of cover you have for funding alternative accommodation and help you with the immediate costs of finding somewhere to stay

         your insurer will also arrange for a loss adjustor to visit your home to assess the damage, and will arrange for emergency pumping to remove any remaining water

         open doors and windows to ventilate and dry out the property

         ensure your home is completely dried out before attempting any redecoration work

Around five million people in two million properties live in flood-risk areas, and you can check the risk of your property getting flooded by visiting www.environment-agency.gov.uk.

Worrying figures from the Association of British Insurers (ABI) show that in some areas affected by the 2007 summer floods, barely three out of four homeowners had contents insurance in place.

It is easy to think that floods won't happen to you, but given the risks and costs involved if you do fall victim, home and contents insurance is not something to be sacrificed.

It is crucial that you have adequate cover in place -- and this applies regardless of whether you live in a flood-risk area or not.

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