Home insurance boom starts
- Published: 17/07/2007
Thousands of homeowners in flood-afflicted parts of the UK have been applying for home insurance for the first time in the aftermath of last month's floods, a new report states.
A study from price comparison site moneysupermaket.com reveals that applications from residents in Hull, Doncaster, Sheffield, the West Midlands and parts of Scotland increased by 300 per cent in June compared to the previous month.
Despite the fact that floods have affected so many parts of the country, there is no evidence to suggest that premiums have risen, says Richard Mason, director of insurance at money supermarket.com.
"For now, insurers say they will still abide by the terms of a deal they reached with the government in 2002," he commented. "This states that insurers will continue to offer cover for those already insured and take on new business where defences are in place or planned.
"At present, the evidence suggests premiums have not yet risen in the aftermath of the floods. In an attempt to maintain market share, insurers may well absorb much of the claim costs from reserves. However, if the government ever reneges on its part of the deal to build more flood defences, then cover may either be withdrawn or premiums spiral to as much as ten times current costs.
"I would strongly urge any homeowners whose properties are on flood plains to buy good-quality home insurance immediately. Doing so ensures they will continue to be covered regardless of what happens in the future," he urged.
A study from price comparison site moneysupermaket.com reveals that applications from residents in Hull, Doncaster, Sheffield, the West Midlands and parts of Scotland increased by 300 per cent in June compared to the previous month.
Despite the fact that floods have affected so many parts of the country, there is no evidence to suggest that premiums have risen, says Richard Mason, director of insurance at money supermarket.com.
"For now, insurers say they will still abide by the terms of a deal they reached with the government in 2002," he commented. "This states that insurers will continue to offer cover for those already insured and take on new business where defences are in place or planned.
"At present, the evidence suggests premiums have not yet risen in the aftermath of the floods. In an attempt to maintain market share, insurers may well absorb much of the claim costs from reserves. However, if the government ever reneges on its part of the deal to build more flood defences, then cover may either be withdrawn or premiums spiral to as much as ten times current costs.
"I would strongly urge any homeowners whose properties are on flood plains to buy good-quality home insurance immediately. Doing so ensures they will continue to be covered regardless of what happens in the future," he urged.