The reinsurer anticipates cuts to result in reduced prices for consumers in flood prone areas
Flood Re has announced that as of 1 January 2019 its reinsurance premiums charged to insurers will be reduced by up to £112.
Originally its intention was revealed in October last year.
While the end price charged to consumers is to be decided individually by insurers, Flood Re anticipates these cuts could result in reduced prices for consumers with households in flood-prone areas paying significantly less for home insurance.
The news follows Flood Re’s decision not to increase premiums in line with inflation last year.
Andy Bord, chief executive at Flood Re, explained: “Our purpose is to make home insurance both more affordable and more available for those people living in high flood-risk areas.”
Premiums charged by Flood Re to insurers are set based on council tax bands. From the beginning of 2019 these will be reduced by 12.5% for buildings and 33% for contents.
This means a reduction of between £44 and £112 for a combined buildings and contents policy.
Bord added: “Our consultation with the insurance industry suggests that these changes could save their customers as much as £112 a year on their home insurance. Householders should always shop around to get the right deal for them.”
Since the reinsurer’s launch in April 2016 more than 200,000 properties have used the reinsurer’s policies.
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