Home Insurance - The Postcode Lottery

The floods experienced by large parts of the UKviewing the property?
earlier in the year will have left in their wake muchThen there is the issue of re-occurring floods: without
damage, both in a structural and psychological sense.insurance how will property owners find the money to
For some, the best coping method is to consign thepay for repair? News that insurers may have to
whole event to the darkest recesses of the mind andincrease the cost of their policies to factor in losses
make a fresh start by claiming through a homefrom flooding has heightened the fears of the public still
insurance policy.further.
That's if you were one of those lucky enough to haveIt appears that as a country we are simply
an active policy at the time of the flooding.under-resourced in the area of flood protection. The
Unfortunately, buildings and contents cover is notfigure of £2.15bn promised by environmental
mandatory and many homeowners in the UK do notsecretary Alistair Darling over the next three years
have any protection in place.was not enough before the flood crisis and is certainly
Mortgage lenders can insist on buildings cover being innot enough now according to the Association of British
place on the property before they will release theInsurers (ABI), the industry trade body.
funds to purchase it. Those who would otherwise notStephen Haddrill, the director general of ABI, was
have considered it will no doubt now be glad theyrecently quoted as saying that the government had
were effectively coerced into it.not committed enough money to fund new and
As I'm sure you can imagine, the damage causedexisting flood defences. This meant a major increase
during the flooding and the resulting repair bill was huge.in spending would be needed if we are to solve the
In fact the final figure is said to stand somewhereincreasing problem of flooding in the UK.
between £2bn and £3bn.In perhaps a sign of things to come the Environment
The problem now faced by some homeowners isAgency last month announced it would no longer be
effectively a postcode lottery on their home insurancemaintaining defences at the Blyth Estuary in Suffolk as
policy. Those living in areas prone to flooding, so-calledit felt the cost of repairing them outweighed the benefit
"flood plains", could find insurers unwilling to cover theirreceived.
property for flood damage under standard buildingsThis only goes to show that a house insurance policy
cover protection.that provides flood cover is invaluable at this time and
This has left homeowners worrying what will happen ifif you have no cover in place you should certainly
they try to sell their homes in order to move to anconsider it, whether you live in an area prone to
area with less risk of flooding. Will property prices fall inflooding or not.
these areas? Will prospective buyers be put off