James Moore: Flood Re can mop up this water problem but what about the future?

Outlook Bring on Flood Re. The most recent estimate of deluge-related damages from the Association of British Insurers stands at £426m. If that sounds rather low, it's worth remembering that it only covers the festive period and new year up to 8 January.

It's also true that the floods have largely affected low-lying areas where premiums were set in anticipation of such events, mitigating losses. However, the River Thames is lapping at the bottom of the gardens of some of Britain's more expensive properties, so that could soon change.

It says much that Hiscox yesterday warned premiums may have to rise. Hiscox, of course, is a Lloyd's of London business that successfully branched out into the somewhat specialist area of providing cover to the wealthy. So it has more than a passing interest in what the Thames does next.

Events like this are becoming more common, and it's not climate scientists saying that to upset UKIP. The information comes from insurers' modelling.

Of course, next time it might not be such an issue because Flood Re will take the strain. Everyone with a UK policy pays a levy into its coffers so those facing flood risk get protected for an affordable sum.

Insurance is based on mutual pooling; this just does it on a grand scale, and it makes a lot of sense even to those (like me) who live at or near the top of hills.

As such it applies Polyfilla to the cracks in the old deal between Government and the industry. That required existing insurers to continue to provide cover to those at risk. Unfortunately it didn't restrict prices (so insurers made them unaffordable) and new entrants could anyway ignore anyone living down dales while offering cheap and profitable home insurance to those up hills.

But Flood Re only deals with an existing problem – how to ensure that those at risk of flooding now can get affordable cover. The future presents another problem. There is a crying economic and demographic need for new homes to be built. Attempts have already been made to relax planning rules that prevent this. What happens if they get built on flood plains in the future? Or places that might become at risk of floods (remember it's not just climate scientists warning that this problem is getting worse).

Flood Re, now advertising for a CEO, isn't supposed to cover new builds.

Prospective new-build owners had better check flood maps (assuming they can find them) because they're on their own.

Start your day with The Independent, sign up for daily news emails
PROMOTED VIDEO
ebooks
ebooksA year of political gossip, levity and intrigue from the sharpest pen in Westminster
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Selby Jennings: Oil Operations

Highly Competitive: Selby Jennings: Our client, a leading European Oil trading...

The Jenrick Group: Night Shift Operations Manager

£43500 per annum + pension + holidays: The Jenrick Group: Night Shift Operatio...

SThree: Trainee Recruitment Consultant - LONDON

£20000 - £25000 per annum + OTE £40,000 + Car + Pension: SThree: SThree are a ...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE £35K: SThree: We consistently strive to be the...

Day In a Page

Isis in Iraq: Yazidi girls killing themselves to escape rape and imprisonment by militants

'Jilan killed herself in the bathroom. She cut her wrists and hanged herself'

Yazidi girls killing themselves to escape rape and imprisonment
Ed Balls interview: 'If I think about the deficit when I'm playing the piano, it all goes wrong'

Ed Balls interview

'If I think about the deficit when I'm playing the piano, it all goes wrong'
He's behind you, dude!

US stars in UK panto

From David Hasselhoff to Jerry Hall
Grace Dent's Christmas Quiz: What are you – a festive curmudgeon or top of the tree?

Grace Dent's Christmas Quiz

What are you – a festive curmudgeon or top of the tree?
Nasa planning to build cloud cities in airships above Venus

Nasa planning to build cloud cities in airships above Venus

Planet’s surface is inhospitable to humans but 30 miles above it is almost perfect
Surrounded by high-rise flats is a little house filled with Lebanon’s history - clocks, rifles, frogmen’s uniforms and colonial helmets

Clocks, rifles, swords, frogmen’s uniforms

Surrounded by high-rise flats is a little house filled with Lebanon’s history
Return to Gaza: Four months on, the wounds left by Israel's bombardment have not yet healed

Four months after the bombardment, Gaza’s wounds are yet to heal

Kim Sengupta is reunited with a man whose plight mirrors the suffering of the Palestinian people
Gastric surgery: Is it really the answer to the UK's obesity epidemic?

Is gastric surgery really the answer to the UK's obesity epidemic?

Critics argue that it’s crazy to operate on healthy people just to stop them eating
Homeless Veterans appeal: Christmas charity auction Part 2 - now LIVE

Homeless Veterans appeal: Christmas charity auction

Bid on original art, or trips of a lifetime to Africa or the 'Corrie' set, and help Homeless Veterans
Pantomime rings the changes to welcome autistic theatre-goers

Autism-friendly theatre

Pantomime leads the pack in quest to welcome all
The week Hollywood got scared and had to grow up a bit

The week Hollywood got scared and had to grow up a bit

Sony suffered a chorus of disapproval after it withdrew 'The Interview', but it's not too late for it to take a stand, says Joan Smith
From Widow Twankey to Mother Goose, how do the men who play panto dames get themselves ready for the performance of a lifetime?

Panto dames: before and after

From Widow Twankey to Mother Goose, how do the men who play panto dames get themselves ready for the performance of a lifetime?
Thirties murder mystery novel is surprise runaway Christmas hit

Thirties murder mystery novel is surprise runaway Christmas hit

Booksellers say readers are turning away from dark modern thrillers and back to the golden age of crime writing
Anne-Marie Huby: 'Charities deserve the best,' says founder of JustGiving

Anne-Marie Huby: 'Charities deserve the best'

Ten million of us have used the JustGiving website to donate to good causes. Its co-founder says that being dynamic is as important as being kind
The botanist who hunts for giant trees at Kew Gardens

The man who hunts giants

A Kew Gardens botanist has found 25 new large tree species - and he's sure there are more out there