This page contains a Flash digital edition of a book. Industry News & Views Caroline Spelman

Member of Parliament for Meriden and Secretary of State for the Department of Environment, Food and Rural Affairs.

Paul Cobbing, NFF Paul is Chief

Executive of the National Flood Forum, a national charity that supports and represents people and communities at risk of flooding. He has worked on many environmental issues throughout his career for public, private and voluntary organisations. The National Flood Forum is now trying to ensure that the needs of people at risk of flooding are at the heart of new policies on insurance.

Flood Insurance - Ministerial Statement

Recent events have once again underlined the

importance of safeguarding the widespread uptake of affordable insurance. The central objective is to reach an agreement with insurers whereby insurance bills remain affordable without placing unsustainable costs on wider policyholders and the taxpayer. There is the potential to deliver a new approach that is a step-change better than the current Statement of Principles, by for the first time directly addressing the affordability of flood insurance. This is a complex issue, as insurers themselves recognise, and we have undertaken to work with the Association of British Insurers (ABI) to look at ways of providing safeguards. A number of proposals have come forward from the industry and we are continuing to consider a range of options. These discussions have made significant progress. The Government is considering with the industry’s support a way of formalising existing pricing arrangements and maintaining the current cross- subsidy in place between policyholders. This would be by means of an internal industry levy, as proposed by insurers themselves. By reflecting existing arrangements, the levy would avoid increasing costs for those not at risk whilst helping households to continue to afford insurance in flood risk areas.

This work is taking place against a backdrop of significant advances in flood risk mapping and forecasting which in turn is giving insurers the ability to more accurately ascribe the level of flood risk to individual properties. As this knowledge base expands it will bring

considerable benefits, not least in terms of helping

Government, local authorities, households and businesses plan for and mitigate the risk of flooding. Investment by all in preventing flood damages from occurring will remain the best and most sustainable way of achieving affordable insurance over the long-term.

The Government and insurers are determined to see insurance premiums remain affordable and widely

available, particularly in light of the pressure household budgets are currently under and the pattern of flood events


we have seen over recent years.

The priority is now to resolve detailed design issues including how support would be targeted. We are looking to develop with insurers a model that delivers benefits to households in need of support whilst avoiding poorer policyholders subsidising wealthier ones. We are looking for an approach which also encourages individuals and communities to consider the actions they can take to keep future premiums down. This measure would be intended to facilitate a gradual change in the market but would still mark a step change in Government’s role in the management of flood risk. As such any proposal will require detailed scrutiny before it could be introduced.

Meanwhile, this Government is continuing to fulfill its role in reducing flood risk by spending more than £2.17 billion on flood and coastal erosion risk management in England over the current four year spending period. 60 new schemes are moving into construction this year under our new partnership approach to funding which has already brought forward £72 million in additional investment from other sources. We expect that the benefits of our investment in risk management will be reflected in reduced insurance premiums going forward.

The recently published National Planning Policy Framework fulfils the Government’s commitment to avoid unnecessary building in floodplains and this outcome has been welcomed by the ABI and others. We are helping insurers incorporate the protection afforded by property-level protection measures into their pricing models and, with the industry’s help, are publishing a guide to help households find the best means of accessing insurance in flood risk areas. We are also working with local authorities and other partners to look at the extent to which

communities, through acting together, can help to manage the costs of flood insurance. Intensive discussions with the insurance industry are continuing and we will announce further details in due course. I undertake to update the House at the most appropriate points.

• Mountable & demountable flood protection • Extremely quick & very easy to use • From Flood Warning to Erection in a matter of minutes • Aluminium & Steel manufacture - last a life time & more • Suitable for residential and commercial protection +44(0)1763 244446 Commenting on the Ministerial Satement

Welcome, but ……, says the National Flood Forum

Flood charity the National Flood Forum welcomes the written ministerial statement announcing the Government’s overall approach to the future of flood insurance. Paul Cobbing, the National Flood Forum’s Chief Executive says, “The Government has accepted the need for a pooled model as the National Flood Forum and others have been arguing. However, this is only the first step in making sure that people can get insurance that is affordable and accessible, and that protects vulnerable people in society.”

Floods can tear the heart out of communities. Once the water, the politicians and the cameras are gone, there’s a long hard grind to get life back to normal. The National Flood Forum helps people through the recovery process and sets up local support groups, empowering individuals and communities identify and manage their flood risks in the future, in partnership with authorities.

The floods of the past few weeks highlight the need for Government and the

insurance industry to agree on a sustainable model for future flood insurance. Paul Cobbing says “Government has outlined its approach today; now we need to agree the detail as a matter of urgency.” We need a system that provides affordable and accessible insurance for all; a fair system we know we can rely on, rather than the possibility of hand-outs if the worst happens. In a recent survey conducted by the National Flood Forum, fears about the ability to get insurance at an affordable price were highlighted as a particular concern and callers to our helpline frequently cite the difficulty of getting insurance as a major cause of distress.

Paul Cobbing, Chief Executive of the National Flood Forum said “Households across the country must not be left in the lurch when the Statement of Principles ends next June. Government has to take the lead to ensure this does not happen and time is running out. We need to act now to get the right framework in place.”

Contact Paul by: Telephone: 01299 403055

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