Should the government help fund insurance claims from householders in high risk flood areas?

[anotheoldgit]

http://www.dailymail.co.uk/news/article-2238561/UK-floods-More-200-000-households-high-risk-flood-areas-uninsurable.html

We have all seen the horrific circumstances some householders find themselves in during all these repeating floods.

Should the Government and the rest of Insurance customers help by providing an emergency fund to help them out?

/// To cover floods such as this one, the Government is being asked by the UK's biggest insurers to provide an overdraft to cover exceptional levels of claims from next summer. ///

/// In return insurers say they will charge homes in lower-risk areas an extra £10 per year and put all the cash in a fund for emergencies. ///

/// Any extra money they need would be provided by the Government, which they plan to pay back over several years. ///

Or better still should the insurance industry be nationalised?

[SeaJayPea]

No, but the idiots who built on flood plains, the authorities who granted Planning Permission for those developments and the surveyors who agreed the mortgage applications should be liable in civil law for action by the people who live there.

[McMouse]

^^^^^^Couldn't agree more.

[jake-the-peg]

I'm not so sure

There's an area near me where they built on the flood plain last year, we laughed because it was an area that always flooded desperately.

Then I watched them put in storm drains that must have been 3 metres in diameter.

All the old houses by the river flooded whilst these stayed dry as a bone.

It's not building on the flood plain, it's doing it without proper planning for managing the fact that's an issue.

If new houses are flooding the planning authority needs to answer questions

[anotheoldgit]

Good answers, perhaps a law should be introduced, but in the meantime, what is the answer?

[jake-the-peg]

The insurers are asking the Government to bail them out because they took on too much risk and are now in trouble

Familliar!

They are not forced to insure against flooding.

No the government should *not* bail them out - why can they not get this 'overdraft' commercially? oh yes it would be too expensive!

Perhaps the government should offer insurance to those who cannot get it because the risk is too high - but I'm not sure about that, I'd need to think a bit more about the pros and cons

[chaptazbru]

I live round the corner from a section of the River Mersey which has never flooded, although the Env Agency say it will in future due to global warming, and because of that a flood barrier is now in the process of being built at a cost of £10m funded by the Government.

[Svejk]

Ever since the Global Warming brigade threatened us with droughts it hasn't stopped bloody raining.
I've often wondered if the whole insurance industry might be a suitable case for nationalisation
.

[Gromit]

And people who live in high risk crime areas could get help off the Government too.

We could abolish insurance altogether and the taxpayers can give free money to anyone who needs it.

[Graham-W]

I presume you mean, "Should we, the public, fund insurance claims from householders in high risk flood areas?"
The government has only our money to play with.
As others have said, build on a flood plain, expect to get flooded. Planners, surveyors, mortgage lenders et al. should be held responsible. Not us.

[craft1948]

The same part of York gets flooded every year, I'm amazed those people can even get flood insurance.

[Graham-W]

I doubt they can, craft.
The woman that lives on the Kellfield side of Cawood Bridge has been quoted £20,000 pa. Apparently she declined.

[craft1948]

The problem is the river Ouse flows right through the city centre, and even with the multi-million pound flood barriers in place the riverside properties are always flooding. Every year the national newspapers show the same picture of the Kind's Arms under water.
The river doesn't appear to get dredged nowadays, I don't know if that would make a huge difference.

[flip_flop]

This has come to light because the UK Insurance Industry's current agreement with the Government concerning the provision of flood insurance ceases next July, and it is unlikely to be renewed.

The UK Insurance Industry is just about the only one there is where flood insurance is freely available - many other countries have 'pool' arrangements for flood insurance.

Insurance is about insuring fortuitous losses - I can see no compelling reason why the insurance industry should provide flood insurance for losses which, in some areas, is becoming inevitable: this would make no sense at all.

Would anybody part with money betting on a horse to win a race knowing beforehand that it was not going to win? I strongly suspect not!

Therefore it makes absolute sense for a pool arrangement for those who can't obtain flood cover.

Should the insurance industry be nationalised? Only if you want your premiums to go through the roof. Because of the large numbers of insurers operating in the UK and their desire to obtain market share, insurance is, by and large, pretty cheap.

[friedgreentomato]

No, I had the choice of a house by the river or a house elsewhere - I chose elsewhere.

Most other people have the choice when choosing a house.

[Arksided]

OP, no they shouldn't, they take enough from us it is (tax payers). I do sympathise with the home owners. but they knew the risk they were taking (surely) especially with the high risk premium of insurance of taking on such a property. IMO its the the insurance companies that should be covering what they said they would cover.

[Arksided]

*as it is

[EDDIE51]

Look at this map of the flood prone areas
http://maps.environment-agency.gov.uk/wiyby/wiybyController?x=531500.0&y=181500.0&topic=floodmap&ep=map&scale=3&location=London,%20City%20of%20London&lang=_e&layerGroups=default&textonly=off#x=531500&y=181500&lg=1,&scale=3
Huge areas of the South of England are effected, all have high density housing. Where the hell could we relocate them to?
As has been said, the present government funding for flood insurance subsidy expires next year, coupled with that the cash for flood defenses is being cut drastically.
From next year unless there is a solution 2 million homes (mainly in very high cost areas in Southern England) will be uninsureable and therefor virtually worthless. There are 200,000 such homes at the moment but the cuts in flood defense spending is expected to increase that to the 2 million I mentioned.
Apparently flood insurance payouts are already £1 billion this year and at that rate insurance companies will be bankrupt within 3 years. Remember no insurance means no mortgage !

[douglas9401]

The government should be encouraging and facilitating public works projects such as proper drainage to provide employment for those cast aside in this alleged recession and peace of mind to those at risk from flooding.
Easier to hop over to some swanky hotel and shout at other inadequates though.

[DTCwordfan]

It seems to be confidential info from here, eddie! Access denied.

[EDDIE51]

DT there was a program about it on Radio 2 this evening, the 200,000 and the increase to 2 million was mentioned by an insurance industry spokesman so it may be an over estimate , still going to be substantial though as the spending cuts are on maintenance of current defenses as well as funding for new ones. The flood situation is going to get MUCH worse.