THE ASSOCIATION of British Insurers (ABI) says the government must come to a new agreement soon if it wants to secure a sustainable flood insurance market in the UK.
It claims that up to 200,000 property owners will struggle to get affordable insurance when the current agreement ends in June 2013.
At the moment insurers agree to provide flood cover as standard for low-risk properties, on the condition that the government invests in defences. The industry feels that the government’s decision to cut spending on defences means it has reneged on its part of the deal.
Richard Benyon, the minister responsible, yesterday ruled out renewing the existing agreement.
James Dalton, the ABI’s Head of Property Insurance, said: “We are running out of time to ensure that people in high flood risk areas can continue to get affordable flood insurance when the Statement of Principles expires in June 2013.
“It is widely recognised that the current industry agreement with the government is unsustainable, [and] has thwarted choice for consumers,” ABI said in a statement.