Flood damage bill expected to top £1bn mark for the first time this year
Homeowners face being unable to insure their properties as the annual cost of flood damage is set to reach the £1bn mark this year.
Research by property search firm SearchFlow, also claims the cost of individual major flooding events is also rising, according to the Independent.
Figures from the Environment Agency show a major coastal flooding event in the Humber estuary could cause damage worth £266m while, as sea levels rise, this could hit £1.4bn by 2040.
The Environmental Agency predicts in the next 30 years sea levels will rise by approximately 40cm. Without improvement in flood defences, this would increase the number of properties at significant risk of flooding in Eastern England by 48%.
With the Association of British Insurers calculating that an increase in the cost of a single flooding event to £12bn would require 10% of the capacity of the global reinsurance market, concerns are rising about some homes becoming uninsurable.
On 30 June next year, the “Statement of Principles” agreed between the Government and the insurance industry over flooding, guaranteeing insurers’ offer a policy to those in flood-prone areas, runs out.
Richard Hinton, business development director of property search firm SearchFlow, said: “So great is the potential risk from rising sea levels and construction on the floodplain to accommodate a rising population, the UK’s flood liability could come to dominate the global reinsurance market. In practice, that would mean many in high risk areas would be unable to obtain insurance at all, which would significantly reduce the value of their properties and potentially could put homeowners in breach of their mortgage agreements.”