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The recent changes to the Flood Re agreement between insurance companies and the government means that those properties in the higher price brackets, that come under council tax Band H, are now included in the cover. Disappointingly flat owners and landlords are once again left "out in the wet" as they are still not allowed into the scheme.
The Flood Re agreement means that communities living within high risk flood areas would not be subject to high insurance premiums.
Those groups which are at present excluded from the draft regulations are the private rented sector, most of the leasehold properties and originally council tax Band H properties, until the announcement of the new change earlier this month (December).
The BPF ,British Property Federation , is highly critical of the government's stance of not expanding the scheme further, begging the question as to why people who live in freehold flats are not as high a priority as those living in more expensive properties ?
Other leading industry bodies, alongside the BPF, have on numerous occasions asked DEFRA, the Department for Environment, Food and Rural Affairs, why is the scheme being touted as providing protection for "homeowners" living in high flood risk areas, when so many are in fact excluded from it ?
The BPF has constantly told the government of their increasing concerns of the Flood Re regulations about widening the catchment. Despite the government, earlier in the year, allowing owner-occupied leasehold units in blocks of three or less being allowed into the scheme, the BPF is still awaiting the a reply from the government on their methodology of determining the threshold. Those properties that have been built after 2009 are excluded which is ironic as these owners still have to pay the Flood Re levy.
There are approximately 800,000 leasehold properties at risk from flooding in the UK, of which 70,000 are considered a high flood risk. Unfortunately some leaseholders have had to endure the open market with premiums rising by 500% and the worst is that after a flooding, excesses have increased from £300 to a staggering £25,000.
Ian Fletcher, director of policy at the British Property Federation, said: “While we are pleased for those homeowners in Band H, there is little festive cheer in this announcement for leaseholders, landlords and small businesses.”
“The Government and insurance industry continues to pick and choose who can participate in Flood Re, seemingly at whim, and this latest announcement will look odd to the millions of owners of flats, that they are not protected against escalating premiums, whilst the most expensive houses in the country are. Promises that the Government and insurance industry will monitor the situation of those excluded groups are worthless whilst they remain so airy-fairy on what would trigger them to act, and how they would do so.”
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