Flood premiums could rise 50% in worst hit areas
Insurers will pay out more than £1bn to settle claims from the 2012 floods and will increase premiums by up to 50%, Sky News has reported.
Eight thousand properties were flooded last year, according to the Environment Agency, and PwC now estimates the cost of the floods to the insurance industry will be about £1bn.
PwC partner Mohammad Khan said: “The weather events of 2012 have dented insurers’ profits and will probably lead to renewal premiums rising by up to 5% for those unaffected by the floods and by up to 50% for those flooded.
“The UK floods therefore, have also brought into sharp focus the current standoff between the insurance industry and the government on the renewal of the flood principles - agreement needs to be reached in 2013.”
The negotiations between insurers and the government - over continued cover from insurers in return for government spending on flood defences - will continue until the deadline in June.
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