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Flood risk householders dropping home insurance

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Householders most at risk of flooding in Northern Ireland are dropping home insurance because of the high costs, it was claimed.

People who live in low income areas are likely to be charged £345 more than similar areas in Great Britain, a General Consumer Council report has confirmed.

A spokesperson said the excess on policies was encouraging the less well off to skip insurance. “People can’t afford to take out household insurance even though they know they are more vulnerable going forward to flooding,” he said.

About a third of consumers in Northern Ireland do not have contents insurance or buildings insurance, a report earlier this year from the Consumer Council found.

Officials from the Council gave evidence to the Stormont Finance Committee today.

The spokesperson added: “One of the consequences of the lack of control over development is that in addition to the flood plains and climatic change we have now exacerbated those natural difficulties.

“Many people are faced with a very significant cost not just in terms of taking out household insurance where there has been a flooding incident, the premiums are immediately hiked but (there is a) very, very significant excess that I think is dissuading people from taking out insurance so the risk is actually multiplied.”

There is less choice with only nine providers operating in Northern Ireland. That is partly due to the high start up costs of insurers expanding to the country and a relatively small market, the Council said.

Parts of the lower Ormeau Road in Belfast are often flooded. The Executive has stepped in to help with the clean up costs.

A total of 46,000 properties lie within river and coastal flood plains and there are expected to be more problems because of climate change.

A spokesman for the Association of British Insurers (ABI) said: “The advice is shop around, it is a competitive market, even for some high-risk areas.

“Insurers look to provide cover and a good insurance broker can give you some idea of companies which specialise in that.

“People going uninsured is not something that we want to see, we want to provide cover and we have to balance that desire with the commercial common sense approach, the trick is to get as many people as possible covered.”