The Flood Re scheme is a UK-based initiative designed to help homeowners living in high-risk flood areas obtain affordable flood insurance coverage. Launched in 2016, this program is a collaboration between the UK government and the insurance industry. Its main objective is to ensure that people living in flood-prone regions can secure insurance coverage at reasonable rates, while encouraging them to take preventive measures to reduce flood risks.

Related Reading: Is Storm Damage Covered by Insurance? Unravel the Facts

How Flood Re Works

Participating insurers

Insurance companies that participate in the Flood Re scheme offer flood insurance coverage as part of their standard home insurance policies. The flood risk portion of the policy is then ceded to Flood Re.

Pooling premiums

Flood Re collects the premiums for the flood risk portion from participating insurers, creating a pooled fund. This pool is then used to cover flood-related claims from the insured properties. All home insurers, whether they participate in the Flood Re scheme or not, also contribute a small percentage of all premium they collect from customers into this pool to ensure there is enough money to pay for the flood damage when it occurs.

Subsidising high-risk homes

By pooling the flood risk premiums from multiple insurers, Flood Re can subsidise the cost of insurance for high-risk homes, making it more affordable for homeowners in flood-prone areas.

Encouraging risk reduction

Flood Re also works to raise awareness about flood risks and encourages homeowners to take steps to reduce their flood risk exposure. This includes investing in flood resilience and resistance measures, such as installing flood barriers, raising electrical outlets, and implementing proper drainage systems.

Transition to risk-reflective pricing

The Flood Re scheme is intended to be a temporary solution, with plans to phase out by 2039. The long-term goal is to transition the market towards risk-reflective pricing, where insurance premiums accurately reflect the risk of flooding for each individual property.

Related Reading: Protect Your Home from Flooding

Flood Re Scheme Eligibility

1. Be a residential property in the UK
2. Be insured by the homeowner
3. Have been built before January 1, 2009
4. Be within the Council Tax bands A to H (or equivalent)

Flood Re Scheme Benefits

Affordable Insurance

Flood Re makes flood insurance more affordable for those living in high-risk areas. Without it, the cost of insurance could be prohibitively high for many homeowners in flood-prone regions.

Availability of Insurance

By taking on the flood risk portion of home insurance policies, Flood Re also makes insurance more widely available. This is especially important in areas where insurers might otherwise be reluctant to offer coverage due to the high risk of flooding.

Stabilising the Insurance Market

Flood Re helps to stabilise the insurance market by spreading the risk of flood-related claims across a larger pool of insured properties. This can help to prevent sharp increases in premiums following significant flood events.

Promoting Flood Resilience and Awareness

Flood Re also works to raise awareness about flood risk and encourages homeowners to take measures to reduce their risk. This includes investing in flood resilience measures, which can help to minimise the damage caused by flooding.

Gradual Transition to Risk-Reflective Pricing

By operating as a temporary scheme, Flood Re helps to promote a gradual transition towards risk-reflective pricing. This is a more sustainable long-term approach that encourages homeowners to take steps to reduce their risk and ensures that those with lower risk are not subsidising those with higher risk.

Financial Security

For homeowners in high-risk areas, knowing that they have insurance coverage can provide significant peace of mind. It also ensures that they have the financial support they need to repair and rebuild in the event of a flood.

Related Reading: Is My House At Risk Of Flooding?

Flood Re Scheme Explained: FAQs

Q1. What exactly is the Flood Re scheme?

The Flood Re scheme is a joint initiative between the UK government and insurers. It aims to ensure that homeowners living in areas prone to flooding can secure affordable home insurance. The scheme aids by providing a ‘reinsurance’ service to insurers, allowing them to pass on the risk related to flood damage.

Q2. How does the Flood Re insurance scheme work?

The working of the Flood Re scheme is straightforward. Insurance companies pass the flood risk of certain policies to the Flood Re scheme, for which they pay a premium. If a claim is made due to flood damage, Flood Re reimburses the insurance company, ensuring the homeowner’s claim is covered. This allows insurers to offer more affordable premiums to those in high-risk areas.

Q3. Who is eligible for the Flood Re protection scheme?

Eligibility for the Flood Re scheme is determined by several factors. Generally, you can qualify if your home is in the UK, built before January 1, 2009, and is your primary residence. You also need to have purchased home insurance from a provider participating in the Flood Re scheme.

Q4. How does the Flood Re scheme benefit homeowners?

Flood Re benefits homeowners by making home insurance more affordable and accessible, especially for those living in flood-prone regions. By acting as a backstop for insurers, it encourages the provision of comprehensive and reasonably priced insurance policies to those at high risk of flooding.

Q5. Does Flood Re scheme cover all types of properties?

The Flood Re scheme primarily covers domestic properties. Commercial properties, properties built after January 1, 2009, and buy-to-let properties that are insured under a business contract are not covered. It’s important to check with your insurance provider for specific eligibility requirements.

Q6. Can I directly purchase a policy from the Flood Re scheme?

No, the Flood Re scheme doesn’t sell policies directly to homeowners. Instead, you purchase a policy from a participating insurance provider, which then passes the flood risk to Flood Re.

Q7. How long will the Flood Re scheme be in operation?

The Flood Re scheme is designed to operate for 25 years, until 2039. It’s a transitional measure intended to foster a competitive insurance market where flood risk is accurately reflected in premiums, encouraging homeowners to take flood-resilience measures.

Q8. What are the impacts of the Flood Re scheme on insurance premiums?

The Flood Re scheme helps to lower insurance premiums for homeowners in flood-prone areas. It allows insurers to pass on high-risk flood policies, thereby reducing the overall cost for homeowners and providing wider insurance coverage options.

Q9. How can I find out if my insurance provider participates in the Flood Re scheme?

The majority of UK home insurance providers participate in the Flood Re scheme. To confirm, it’s best to directly contact your insurance provider or check the list of participating insurers on the official Flood Re website.

Q10. What is the future plan for the Flood Re scheme?

The ultimate aim of the Flood Re scheme is to create a resilient market for flood insurance. Over time, the scheme hopes to gradually hand over the risk of flooding back to insurers and homeowners, encouraging more sustainable building and flood prevention measures.

Overall, the Flood Re scheme aims to address the affordability issue of flood insurance for high-risk homes, while promoting long-term risk reduction measures and encouraging a gradual shift towards risk-reflective pricing.

Related Reading: What Is Flood Risk Insurance: Common Questions & Answers

Why Frontier For Flood Risk Insurance?

Flood Risk insurance is intended to protect the things you value most. Frontier offers you protection and total peace of mind through flood risk insurance that is custom designed for your specific need and circumstance. We keep things simple and clear, with no hidden fees, fixed limits or exclusions. What you see, is what you get.

Confused About Flood Risk Insurance? We Keep It Simple

We offer one product – an online self-service solution – allowing you to design your own cover that you can adjust and manage over time. We automatically see if your property may qualify for Flood Re, even if it doesn’t meet the criteria, we may still be able to provide cover including flood. We’ve simplified and personalised the wording too. Read it before you buy – it’s made especially for you.

Instant online quote

With 24-hour access, you can quote online, for an instant price based on your need and circumstance. Our policies can cover buildings, contents and personal possessions and a variety of exceptional items.

How Flood Re works

Every insurer that offers home insurance in the UK must pay into the Flood Re Scheme. This levy raises £180m every year that they use to cover the flood risks in home insurance policies.

Flood Re works with insurers behind the scenes. When you buy home insurance cover, we can choose to pass the flood risk element of your policy to them for a fixed price.

If you make a valid claim for flooding, Frontier will pay the claim. Later on, Flood Re reimburse Frontier from the Flood Re fund.

In short, you buy your home insurance in the usual way. We cover the flood risk and that helps to keep your premium down.

Customer Reviews

Very reasonably priced and covered home business use too. I suffered damage during the storm and they were very prompt and efficient and paid very quickly so I was happy to renew. Good service.

Jim Hendry

Very good cover. Easy claims process. Renewed on a cheaper quote. I will not hesitate to recommend Frontier Insurance to cover your home.

Mark Dalumpines