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Friday 11th July 2008
Despite comments earlier in the year suggesting that the insurance industry would take away flood insurance from many UK homes in high risk areas, it seems that the powerful Association of British Insurers (ABI) has agreed a compromise deal with the government. In return for speeding up investment in the flood defence systems across the UK, the ABI has given the authorities a guarantee that affordable flood insurance will be made available to everyone in the UK – despite that fact that the industry has paid out over £3 billion in flood claims during the last 12 months.
While it is difficult to see who has give way in the talks between the two parties, the likelihood of flood insurance being removed from many parts of the UK was minimal. This would literally have opened up the flood gates for insurance companies to pick and choose the areas they service, and the types of insurance available. Historically the fact that many insurances are required from a legal point of view, such as car insurance, was the government’s payback to the industry – something that the ABI do not seem prepared to risk.
Those in areas with a high risk of flooding are still not in an ideal situation but at least they are will be covered. |
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