Flood Management In The UK July 06

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Risk mapping, risk management and flood insurance in the UK

Risk mapping, risk management and flood insurance in the UK

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  • 1. Working towards a solution: flood management strategies in the UK Jane Milne Head of Property and Creditor Leader, Climate Change
  • 2. UK Flood Cover
    • UK is relatively unique in offering flood cover as a standard feature of household insurance
    • Unlike much of Europe and worldwide, cover widely available to the UK’s 24m households
    • Typical premium is £330 per year
    • Typical flood claim is around £15,000 - £30,000
  • 3. UK Weather Damage Claims
    • Weather risks are increasing at a rate of 2 – 4 % per year, overall
  • 4. Exposures
    • Around 10% of housing stock in flood risk areas (inland or coastal)
    • 2m homes and 130,000 businesses in England in at risk areas, 470,000 at high risk
    • Major inland flooding would cost £1-2bn
    • Extreme tidal surge affecting London could cost up to £30bn
    • Cover dependent on continuing availability of catastrophe reinsurance
  • 5. Climate Change and Flooding
    • Increased winter rain 15 – 30 %
    • Increase in heavy rain up to 20 %
    • Increase in sea level up to 90 cm
    • Increase in storm surge by 120 cm
    • Annual average damages could increase from £1.5 bn to £22 bn
    Source: Foresight “Future Flooding”, April 2004
  • 6. ABI Statement of Principles
    • Provide flood cover as standard feature under normal competitive market for those at less than 1.3% annual probability of flooding ( 1-in-75 yr )
    • Continue cover to existing policyholders in areas where defences will be in place in five years to reduce risk to less than 1.3% annual probability
    • Use best efforts, on a case-by-case basis, with existing policyholders where no defences planned
  • 7. What does it mean for Government?
    • Sustain expenditure and target carefully
    • Use creative solutions
    • Strengthen and implement floodplain planning guidance fully
    • Improve risk maps and asset registers
    • Improve warning systems and emergency plans
    • Tackle sewer/urban flooding
  • 8.
    • Sustained expenditure of £570m annual on river and coastal flooding 2005-08 to protect 100,000 properties in England
    • Sewer flooding - £1bn for 2005-10 to help over 9000 properties at 10% annual probability
    Capital Investment in Flood Defences
  • 9. Land use planning
    • Government wants to increase housing stock in SE England
    • Around 100,000 of these will be in flood risk areas, adding 5% to national flood risk
    • But Government’s new guidance says flood risk areas should be avoided except in very limited circumstances
  • 10. Land use planning
    • Environment Agency is to become statutory consultee
    • Where advice is ignored Secretary of State will have right to call in
    • Insurers and mortgage providers back sustained objections by Environment Agency
  • 11. What can homeowners do?
    • Increase resistance and resilience of their properties to flood damage, perhaps with grants from Government or in partnership with their insurer
    • Take practical steps to reduce the cost of flood repairs and speed up recovery times
    • Use flood protection devices and flood warning systems, where appropriate
  • 12. Offering support to customers
  • 13. Integrated drainage plans Glasgow Flooding 30/7/02 - Case Study No 2 (22 Int) A C B 2000 m3 FPV Flood Area Volume 700 m3 STV 1 in 30 yr upgrade Piped Watercourse Flooded Area Overland Flow Overland Flow Overland Flow
  • 14. Further information
    • For further information on flooding and climate change issues or to download copies of our recent publications see
    • www.abi.org.uk/flooding or
    • www.abi.org.uk/climatechange