Owners warned on flood risk insurance
Tuesday, 17 January 2012 10:57 AM
The end of an agreement between the insurance industry and the government could leave property worth £214 billion uninsured, according to research by Search Flow.
The property search firm says home owners of the one in four homes in the UK that are at risk of flooding could find themselves unable to get insurance against it when the statement of principles agreed between the government and Association of British Insurers expires at the end of June 2013.
And it warns this could mean owners will be unable to insure their properties from this summer as insurers become unwilling to offer policies that expire after the end of the agreement.
The research says uninsured properties could leave owners in breach of their mortgage contract as well as being harder to sell and remortgage. It says insurers are already trying to rid themselves of homes at significant risk of flooding and that some owners have been unable to obtain policies with excesses below £20,000.
Richard Hinton, business development director at SearchFlow, said: "The end of the principles agreement between the ABI and the government could make flooding a hugely contentious issue during the conveyancing process when professional conveyancers have to consider the potential risks a property faces.
"Although buyers will be able to obtain flood insurance for the next few months, the long-term prospects of properties at risk of flooding are potentially bleak."
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