Flood Re reports £46m in GWP for 12 months to March 2022

UK government-backed flood reinsurance scheme Flood Re achieved £46m in gross written premium (GWP) for the year ending 31 March 2022, according to its latest financial results, published today (12 July 2022).

This represents an increase in GWP from the previous reporting period – the 12 months to March 2021 saw the scheme net £39m in GWP.

In its annual financial results, Flood Re also noted that it had written 256,634 policies in the year to the 31 March 2022. This was an 18% increase from last year, which saw Flood Re write 218,090 policies.

Andy Bord, chief executive of Flood Re, said these results evidenced “Flood Re’s continued strong financial position”.

He added that while the last year had been “unusually dry” for the UK, extreme and damaging floods in Germany had “further motivated insurers to recognise the value of [Flood Re] and cede more policies to it”.

“Rising inflation, coupled with the reduction of Flood Re’s inwards premiums in real terms, has increased the propensity of insurers to cede policies to the scheme – in part accounting for the 18% year-on-year growth,” Bord explained.

Build Back Better

Flood Re launched its ’Build Back Better’ scheme on 14 April 2022. Designed to increase policyholders’ resilience to flood damage, the programme enables flooding victims to claim up to £10,000 to implement flood resilience measures on top of the cost of repair work caused by flood damage, via participating home insurers.

Five insurers initially committed to the Build Back Better scheme – NFU Mutual, Aviva, Ageas, Lloyds Banking Group and LV= General Insurance.

Today, Bord announced that Flood Re was in “advanced discussions” with “most” of the UK’s remaining insurers. He expects the number of participating firms to “increase over the course of the year”.

Initiatives such as Build Back Better are dependent on government support - Bord said that Flood Re would continue to lobby the government for initiatives that would support its goal of creating a more flood resilient society.

He said: “Our focus will be around lobbying for those initiatives. For example, making sure there’s simple, clear guidance from local authorities and from the environment agencies for developers in terms of how to build.”

Bord added that he had been provided assurances from senior officials within the Department for Environment, Food and Rural Affairs “within the past 24 hours or so” that recent political turmoil around prime minister Boris Johnson’s resignation would not derail Flood Re’s policy objectives.

“Government is committed to continuing all of the policy that is in train already,” he explained. “There won’t be any major shifts in policy until a new prime minister – and presumably a new cabinet – is in place.”

“The reality is that political change happens all the time and while this situation has been particularly dramatic, we need to respond to that and make sure momentum isn’t lost rather than getting worried or excited about changes.”