By Rob Starr, Content Manager, Big4.com
David Hindley, insurance partner at Deloitte, comments on the fact that the Met Office’s provisional figures confirm that 2012 was the UK’s second wettest year on record and the lack of a flood agreement with Government is household insurers’ biggest concern.
“Flooding can produce very significant claims for insurers and it is not surprising that one of the biggest concerns for household insurers is the fact that the government and insurance industry have not yet agreed a mechanism for continuing to provide affordable flood insurance for high-risk households once the current agreement expires in mid-2013,” he says. “If an agreement is not reached, people in high-risk areas will find it difficult to find affordable flood cover.”
“The high rainfall of 2012 was a further reminder to insurers that flood risk has not gone away and insurers will have to consider whether their flood risk data and models are detailed enough to make effective pricing and underwriting decisions for individual properties.”