DEPARTMENT FOR
ENVIRONMENT, FOOD AND RURAL AFFAIRS News Release (220/08) issued by
The Government News Network on 11 July 2008
The ABI
(Association of British Insurers) and the Government have reached
agreement that ensures flood insurance remains widely available
now and in the long term.
The agreement outlines the actions that both Government and the
industry will take over the long term. These include:
* Improving understanding of flood risk.
* Government putting in place a long-term investment strategy,
which will set out strategic flood prevention aims and assess
future policy options and funding needs
* Ensuring that the planning system prevents inappropriate
development in flood- risk areas.
* Raising awareness in areas where flood risks are significant,
encouraging property owners to take sensible precautions, and
providing more information about how to obtain flood insurance.
* Promoting access to home insurance for low-income households.
Implementing these steps should lead to a competitive flood
insurance market, without the need for the Statement of
Principles, which will therefore end in 2013. Until then, insurers
will continue to:
- Make flood insurance for homes and small businesses available
under household and commercial insurance, where the flood risk is
no worse than a 1 in 75 [1.3%] annual risk.
- Offer flood cover to existing domestic and small business
customers at significant flood risk, providing there are plans to
reduce the risk to an acceptable level within five years.
Floods Minister, Phil Woolas, said:
"The devastation caused by last year's unprecedented
rainfall has shown just how vital it is for people to be able to
insure their homes and livelihoods against the risk of flooding.
"Working together we have succeeded in ensuring that flood
cover is available in both the short and long term. I'm
delighted that the industry has agreed to work with us to raise
awareness and encourage homeowners to take steps to protect their
homes where appropriate."
Stephen Haddrill, the ABI's Director General, said:
"This agreement is good news for everyone at risk of
flooding. We are pleased that the Government recognises that a
long-term investment strategy, adequately funded, is the best way
to manage the growing flood threat. It will help ensure that the
flood insurance protection, relied upon by millions of
householders and businesses, remains widely available. We will
continue to work closely with Government, and review progress each year."
Notes for Editors
1. Details of the full agreement between the ABI and the
Government and
details of continuing work and commitments can
be found at: http://www.abi.org.uk, and http://www.defra.gov.uk/environ/fcd/policy/insurance/govtcommitments.htm.
The joint statement itself can be found at http://www.defra.gov.uk/environ/fcd/policy/insurance/jointstatement.htmFor
more information about insurance please go to: http://www.defra.gov.uk/environ/fcd/policy/insurance.htm
For more information about insurance please go to: http://www.abi.org.uk
2. Government and the ABI announced the annual review of the
Statement of Principles on 13 February this year. The agreement
outlines the measures Government and the industry will take to
ensure flood insurance remains available.
3. The Statement of Principles on the Provision of Flood
Insurance applies to England. Similar discussions are at an
advanced stage of agreements with the devolved Governments of
Scotland, Wales and Northern Ireland.
4. The Statement of Principles will not apply to properties built
from 2009.
5. The ABI is the trade association for Britain's insurance
industry. Its nearly 400 member companies provide over 94% of the
insurance business in the UK. It represents insurance companies to
the Government, and to the regulatory and other agencies, and is
an influential voice on public policy and financial services
issues. ABI member companies hold up to a sixth of all investments
traded on the London Stock Exchange, on behalf of millions of
pensioners and savers.
Public enquiries 08459 335577;
Press notices are available on
our website
http://www.defra.gov.uk
Defra's aim is sustainable development
To subscribe
or unsubscribe to Defra's mailing list go to: http://nds.coi.gov.uk
Association of British Insurers
51 Gresham Street
London
EC2V 7HQ
http://www.abi.org.uk
Defra
Nobel House
17 Smith Square
London SW1P 3JR
http://www.defra.gov.uk