Flood Re has today published a transition plan detailing how it will help home insurance customers in flood-risk areas get a better deal once the scheme expires in 2039.
Flood Re, which is due to start operating in April and could benefit up to 350,000 homes, has outlined how it will use the data it collects to help insurers better understand the costs of dealing with flood damage and what measures they could take to lower risks. It hopes that, by doing so, the industry will be able to lower the costs of flooding and, therefore, the cost of insurance.
"If we are to successfully reduce premiums and excesses for flood prone homes in a sustainable way over the coming decades, action must be taken to reduce the cost of flooding," said Brendan McCafferty, chief executive of Flood Re. "These properties will need to be made more resilient when flooding happens and action needs to be taken to bring down the cost of repairing flood damage."
Earlier this month, Flood Re, which has been set up to help limit the cost of flood insurance for high-risk households, announced that it had secured £2.1bn in its reinsurance tender process.
However, on Monday, academics warned that unaddressed concerns over surface water could lead to a rise in the number of homes at risk from flooding, therefore calling Flood Re's chances of success into question.