Homebuyers given false sense of security over flood risks, claims Shropshire insurance company

Homebuyers may be lulled into a false sense of security when it comes to flood risks due to the terminology used by UK-wide organisations, a Shropshire insurance company claims.

Flooding in Shrewsbury earlier this year
Flooding in Shrewsbury earlier this year

That is according to Dave Williams from Henshalls Insurance Brokers in Newport and Shrewsbury, who said the criteria used to calculate whether a property was likely to flood meant buyers were not aware of the true scale of the risk.

“The Environment Agency currently reports flood risk based on the chances of an area flooding in any one year," said Mr Williams.

“They rate homes on a scale from 1-in-100 to a 1-in-30-year chance of flooding as being at medium risk.

Dave Williams

“But research has shown that over a typical 30-year mortgage, this rating meant there was between a 26 and 63 per cent chance of the property being flooded once, which is a far greater risk than the current criteria would suggest.”

Dave said Zurich UK insurance firm claimed 530,000 properties in England faced a more extreme risk of flooding than official maps showed.

It comes after Shropshire has been hit by several waves of severe floods in recent years.

“Most insurers now have a traffic light system for each postcode where green signifies no flood risk, amber may need more consideration and may include a higher excess, and a red alert means flood cover will be declined," added Mr Williams.

“The onus is on the buyer to research the risks faced by any property they’re interested in, and if it does fall into the red category, some insurers will provide general insurance cover but exclude flood protection, but others will decide not to insure the property at all.

“Obviously living near a river has its plus points, and the setting itself can be idyllic, but you may consider that ongoing flood risks and the lottery of insurance cover are too much to take on.

“The issues of flood insurance cover could also affect your chances of selling the property on in the future because mortgage companies usually insist on cover against flooding, so it may mean you’re limited to cash buyers only.”

Mr Williams said that even if a property had flooded previously, it may still be possible to secure insurance cover, but it would be at the discretion of the provider as to whether they would allow it.

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