Skip to main content

Homeowners living in high flood-risk areas could receive cheaper insurance under a new Government-backed scheme called Flood Re. The scheme launched this week and it’s expected to benefit up to 350,000 households. It works by taking on the flood risk part of a policy to help insurers offer more affordable cover.

To get you up-to-date on what this scheme could mean for you (whether you live in a flood prone area or not) we’re going to run you through the details.

How does Flood Re work?

From Monday, home insurers can pass on the flood risk element of a policy to the Flood Re scheme – and the scheme will then take responsibility for this. An industry tax of £180m a year will be introduced to fund the scheme and each insurer signed up to the scheme will pay this. It’s expected that most insurance companies will pass the cost of this on to customers.

This new scheme won’t affect the way you buy insurance or how you make a claim, but your insurer will recover the costs of a flooding claim from the scheme.

Will this affect me?

The answer to this will depend on your circumstances. If you live in a flood risk area, you could get cheaper cover. You may even find it easier to get insurance for your home if this is something you’ve had difficulty with in the past.

If you don’t live in an area that’s generally affected by floods, you might have to pay a little more on your building and contents policies as a result. Flood Re predict that this will be an average of around £10.50 a year, although it may only be a few pounds more if you live in a smaller house with a lower council tax band.

People eligible for the scheme will see their policy excess capped at £250 as well. This is sure to be a popular move, as people in the past have had to put thousands of pounds towards repairing their homes after a flood.

Which insurers are involved in the scheme?

At the moment, 17 insurers are signed up to the scheme:

• Admiral

• Avantia

• Aviva

• Bank of Scotland

• Cherish

• Churchill

• Direct Line

• First Direct

• Halifax


• Hiscox

• Legal & General

• Lloyds Banking Group

• LV

• More Than

• Nationwide

• Privilege

Don’t worry if you don’t see the brand that you have a home insurance policy with, it’s expected that more providers will sign up in the next few days. For up-to-date information on who’s involved in the scheme, click here.

Who’s not covered?

There are a couple of exclusions from the scheme. Homeowners with properties built from 2009 onwards will not be covered. This is to discourage developers from building on land that are at risk of flooding. Leasehold flats or houses blocks of four or more are excluded as well.

Businesses such as small shops are not included, and neither are landlords with insurance policies on homes that they do not currently live in (such as buy-to-let landlords). However, tenants buying contents cover in flood risk areas will be protected under Flood Re.

Legal Information