We’ve been writing for a long time about the struggle to find a new agreement between the Government and insurers over affordable flood insurance. Our most recent blogs have been about Flood Re, the proposed solution which will cap premiums and link them to council tax bands.
The latest milestone in this becoming law was reached recently with the second reading of the Water Bill in the House of Commons. And it seems that, despite some lingering dissent over various aspects of the scheme, there is no viable alternative. The bill has now gone on to the next stage: this week, it has started to be examined by Parliament’s Public Bill Committee.
Areas of contention
The main area of contention remains affordability, particularly around excesses which are likely to be capped at £500, and there is still uncertainty about high-value properties and whether small businesses will be covered. In addition, agreement is needed over when the Government would step in to deal with catastrophic flooding. There’s a great summary of all of this in an insurance industry blog.
But, as this makes clear, Flood Re is really the only show in town and, to quote it, “Whatever arguments lie ahead, we have taken a big step towards a resolution to the challenge of providing affordable insurance for (almost) everybody”.