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Floods: Insurance

Environment Food and Rural Affairs written question – answered on 27th June 2012.

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Photo of Martin Horwood Martin Horwood Liberal Democrat, Cheltenham

To ask the Secretary of State for Environment, Food and Rural Affairs

(1) what progress has been made in the talks on flood insurance;

(2) what alternatives to a voluntary agreement with the insurance industry has been considered for flood insurance after 2013.

Photo of Richard Benyon Richard Benyon The Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs

holding answer 26 June 2012

The availability and affordability of insurance in flood risk areas is an important issue for this Government.

The current statement of principles agreement between Government and insurers expires on 30 June 2013. While it offers some limited reassurance to households about the availability of insurance in areas of flood risk, it has no influence over the price of insurance.

We are at an advanced stage in intensive negotiations with the industry on alternative arrangements for when the statement of principles expires. The merits of both voluntary and regulatory models have been considered. Further announcements will be made in due course.

Meanwhile the Government will continue to invest to reduce the risk of flooding especially to those households at the highest flood risk and living in the most deprived communities. DEFRA expects to spend more than £2.17 billion on flooding and coastal erosion over this spending review period. As a result of the investment we are making, we expect to deliver better protection to 145,000 households by March 2015.

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