Britain’s rising flood risk is further underlined, with figures published by the ABI showing that the cost of flood damage since 2000 has leapt by 200% on the previous decade. With more people set to be at significant risk of flooding, the ABI is calling on the Government to ensure that spending on flood defences is targeted to the most flood vulnerable communities.
One in six homes in England is currently at risk of flooding. Nearly 500,000 people face a significant flood risk, and it has been estimated that this could rise to 840,000 by 2035 without adequate investment in flood defences.
ABI’s figures highlight the huge financial cost of flooding:
– Since 2000 insurers have paid out £4.5 billion to customers whose homes or businesses have been hit by flooding. This is up 200% on the £1.5 billion paid in the previous decade in real terms.
– Major floods since 2000 have included the 2007 summer flooding which resulted in insurers paying out £3 billion, the 2005 floods in Carlisle that cost £272 million, and the Cumbrian floods in November 2009 costing £174 million.
– Reasons for the rise in flood costs include the increased frequency and severity of flooding in the UK and the growing problem of surface water flooding (the Environment Agency has estimated that 2.8 million properties are at risk of flooding from surface water). It has been previously estimated that the total value of assets under flood risk exceeds £200 billion – more than the current budget deficit.
These figures were released at the ABI’s flood conference “Fighting Flood Risk Together” held today. At the conference over 100 representatives from the insurance industry, policy makers and community groups discussed the impact of the Government’s recent announcement of a cut in flood defence spending, and what needs to be done to tackle the UK’s flood problem.
Speaking at the conference, Tim Breedon, ABI Chairman and Group Chief Executive, Legal and General, said:
“Flooding devastates lives and communities. Insurers play a key role in helping those affected recover, but prevention must be better than cure. The recent announcement of a cut in Government investment in flood defences was disappointing, and it is now vital that Government spends its money wisely to bring real improvements where they are most needed.”
Barry Smith, Chairman of ABI’s Property Committee and Chief Executive of Ageas UK, stressed at the conference that:
“Millions of customers rely on the financial protection provided by flood insurance, and insurers are determined to do everything possible to ensure this continues. The insurance industry’s flood insurance agreement with the Government, under which insurers commit to offering flood cover to existing customers, expires at the end of June 2013. To ensure flood insurance continues to remain widely available and competitively priced, further investment in flood management is needed when the public purse is in better shape”.
Source : ABI Press Release