Should We All Pay For Flood Defense.

[modeller]

It's been suggested that everybody should pay £15 - £20 extra on their household insurance to subsidise those who choose to live in flood risk areas .

If they choose to live in pleasant areas near flood plains then they know the risks . Why should the rest of us bail them out ?

[webbo3]

No, if they choose to live in a high risk area of flooding then they should pay extra on their insurance, its a bit like asking someone to help cover me for buying a fancy car.



Dave.

[bazwillrun]

We shouldnt...

[trt]

Precisely modeller, we pay enough charity's to people during hard times, its the luck of the draw.

[Dogsbody2]

It's more then being suggested - it's happening and if you have domestic house insurance you'll be paying, like it or not.
The scheme is run by Flood Re, funding by a levy on insurers.
Guess where they get their funding from? Got it in one.

[EDDIE51]

It is not fair but all insurance policies premiums have been increased to recover the cost of flood payouts. The argument is that if it was not spread out the cost for flood plain areas would be unaffordable.
As I live in an area where a flood is virtually impossible ( 300 ft above sea level and no river within 15 miles) I would exclude flood cover if I took out home insurance.

[youngmafbog]

If they do this then they should have flat rates for all households and not penalise for people that live in high crime areas or have a large house or a flat etc.

Except they wont because that isnt the latest thing the right-on brigade have jumped on - yet.

[jackthehat]

It's been suggested that households *in* high-risk flood areas pay an additional £15 -£20 not every household in the country.

[Baldric]

http://www.telegraph.co.uk/news/earth/flooding/12123738/Homeowners-living-in-flood-hit-areas-face-higher-council-tax-bills.html

[New Judge]

The principle of insurance is that the burdens on the misfortunate few are borne by the fortunate many. Thus, as has been said, all policyholders pay for those misfortunes, not just those most likely to suffer them. Insurers load premiums to account for greater risk where it can be shown to exist but there is no way on earth that all the costs of those recently flooded with be covered by only policyholders in the areas concerned.

[jomifl]

I think that the idea behind insurance is that it indemnifies the unlucky, not the damn stupid.

[modeller]

I remember when the last major floods occurred ( was that 2006 ?) I received an increased household insurance bill to cover it . When I complained they agreed not to charge. I bet all our bills will go up this time .

[Kathyan]

As Baldric's link says, it's extra Council Tax they are being charged not insurance.

[Dogsbody2]

There are two sets of costs to be borne by the majority in support of the unwise:

1) the cost of Flood Re, which starts up in April 2016 and will burden all householders with insurance in order to provide subsidised insurance to the unwise. That is what I was referring to and precisely what modeller asked in his question.

2) the cost of erecting bigger flood defences, which is what JtH, baldric and Kathryn have latched onto because it is today's news. That gets picked up in bigger council tax bills in affected areas.

The quickest amongst you will have realised the double whammy on those who chose their house carefully, just above the flood plain and above the torrent level of recently-flooded rivers - you're going to be paying twice - once on the insurance premium, once on the CT.

Here's a quote from what Flood Re says about the first of these costs:

Q: I am at low flood risk, so why should I have to pay the levy on my home insurance so that someone at higher flood risk can get affordable flood insurance?
A:The Flood Re levy is a new charge on insurers based on market share. Insurers will now be eligible to cede selected properties to Flood Re, but will continue to decide on the overall premium charged to individual customers as usual. Better information is now available that shows many people are potentially at flood risk from flash flooding, for instance, and not just people living near a river or the sea. Having property insurance that includes flood cover is usually crucial in getting a mortgage. So if flood insurance was to become harder to obtain and more expensive, this could have serious repercussions for the whole property market.

Insurers will remain responsible for pricing and will decide how best to pass on the benefits of lower premiums and excesses charged by Flood Re to customers.