Must Have Facts For Flood Plain Insurance

Filed Under Finance |

by John Paige

The cost of flood insurance people pay nowadays is affected by the location of their house or residence. Those people whose houses are located in higher-risk areas pay higher premiums and higher excess on flood-related claims as compared to those whose houses are in low-risk areas. Premiums on a house in a high-risk area may differ for example around 20 to 30 higher than in low-risk areas.

In the United Kingdom, more than two million properties are located in flood risk areas. When you seek the services of a flood insurance provider, they have their own maps to determine if you live in a low-risk area. Although your insurance plan should pay for all flood damage, your insurance provider also expects you to take necessary precautions to protect your properties in case of a flood, too.

If you happen to live in a flood plain, then naturally your premiums are going to be higher and it will become a financial burden. There have been instances when the providers have denied cover to persons living in high-risk areas. It would simply be a huge loss to the provider to cover someone in such a risk area unless they were to pay an impractically high premium.

If your house is considered to be potentially too high of a risk, the insurance provider will likely consult a land surveyor to do an analysis and report on the property before offering you a policy. If insurance companies were to cover everyone regardless of the risk of their home to be damaged by flood, then everyone would have to pay significantly higher premiums just to even out the risk caused by those in high flood areas.

A report done in 2004 estimated that by the end of the century, flood damage will have increased twenty fold. This is a result of global climate change and is a threat to the entire world, not only the United Kingom.

Floods can not be prevented, but people can do something to protect their homes from floods. Here are some tips from the Association of British Insurers (ABI). Concrete floors can be replaced with wood and covered with tiles. Chipboard or kitchen and bathroom units can be replaced with plastic equivalents.

The same is true with gypsum plaster. This can be replaced with more water-resistant material, such as lime plaster or cement render. You can also move service meters, boilers and electrical points to areas above likely flood level. One-way valves could also be put into drainage pipes to prevent sewage backing up into the house, hence to prevent flooding.

The bottom line is that if you are moving your house or buying a property for the first time, always check whether your intended new home is on a flood plain or not. This information is readily available on the internet on official Government web sites, so there is really no excuse for not knowing - and if you don’t know, you can be sure that your future insurance company does!

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