Telephone and internet insurer esure has stopped offering home insurance for houses built on flood plains or in areas prone to repeated flooding.
The insurer says it is now limiting the locations it will cover to keep the flood risk element in its home insurance policies to a minimum, and it claims this could reduce insurance costs for millions of UK householders.
esure estimates that customers not living in at-risk areas could save £30 per year per policy.
The insurer made clear, however, that this move does not remove the flooding cover that current esure policies include - neither will it affect the number of existing customers in floodrisk areas.
The change just means that cover will not be offered to the owners or occupants of homes located on flood plains or in high flooding risk areas from now on.
Chief executive Peter Graham said: "esure is entirely sympathetic to homeowners who live in floodrisk areas or on flood plains but they have been let down badly by years of government failure to improve the UK's flood funding, planning and defences.
"Following severe localised flooding in recent years, we believe that the dry majority is now being unfairly penalised through their home insurance premiums on account of the failure to address the risks facing houses built on flood plains and standing in flood-prone areas.
"We will be calling - along with the industry - for improvements to both the funding and co-ordination of flood protection. However, we currently have only a handful of customers in affected areas and - unlike most other insurers - we can make a clean and clear break. From today, our customers will benefit from knowing that our home insurance premiums reflect the effective removal of the floodrisk element."
