Flooding is ‘greatest natural disaster’ risk in UK – Flood Re and ABI

Flooding is the ”greatest natural disaster” risk in the UK, with losses suggested at around £958m a year minus defences, according to a joint report from the Association of British Insurers (ABI) and Flood Re, published today (16 June 2021).

The report, Modelling the Impact of Spending on Defence Maintenance on Flood Losses, was conducted by flood risk specialists JBA Risk Management - the firm evaluated the benefits of flood defences across a 30-year period for several different scenarios. It highlighted the vital need to keep the UK’s flood defences in good condition.

According to the report findings, one in six properties in England and Wales are at risk of flooding. This reduces to one in 11 in Scotland and one in 34 for Northern Ireland. Furthermore, six out of the 10 wettest years on record have occurred since 1998.

The report comes ahead of the government consultation on its comprehensive spending review, which defines government departments’ resource and capital budgets as well as outlines parliament spending plans.

James Dalton, the ABI’s director of general insurance policy, said: “This report makes the compelling case for greater spending on the maintenance of flood defences on which our flood vulnerable communities depend.

”Our report makes clear that not properly maintaining flood defences reduces their lifespan and increases costs overall, so not investing in maintenance is a false economy.

“At the upcoming comprehensive spending review, we urge the government to ensure that adequate investment is allocated to flood defence maintenance projects, as well as capital, as part of the new funding cycle.

”The flood risk in the UK is only going to worsen as a result of climate change, so it is vital that investment in flood defences keeps pace.”

Cost efficiency findings

Key findings from the research show that river defences provide protection to flood risk communities equating to £568m a year. Without such defences, these flood losses could reach approximately £958m a year.

Flood defences also help reduce inland flood losses to around £388m a year, saving £568m.

On top of these savings, the report proved that flood defence maintenance is also cost effective. For example, for every £1 increase in maintenance spending, almost £7 is saved in capital spending on defences.

Therefore, the report stressed that increasing the current maintenance spending by 50% could prolong the lifespan of defences by eight years on average.

Andy Bord, Flood Re’s chief executive, said: “2014 saw the devastating damage and cost in failing to invest in flood defence maintenance. This simply cannot happen again.

”Our primary concern must be to protect communities and families from the impact of flooding. Today’s report shows that it is also financially reckless to do otherwise.

“The government must embrace the opportunity to commit additional budget to maintain our flood defences.

”If maintained, flood defences provide long-term security for communities which may otherwise be devastated by flooding. Protecting against flood risk is also critical to ensuring the long-term availability of affordable home insurance for those living in flood-prone areas.”

Flood resilience

In addition, flood defences that are maintained are “unlikely to breach” -  the report underlined the importance of flood maintenance, highlighting the risk that if spending is cut, flood defence lifespan will greatly reduce in conjunction with annual cost increases.

For example, the current state of existing flood defences in London and the South East has the highest estimated annual flood loss at £117.4m, which makes up 30% of the UK’s total annual flood losses. This is followed by the North West (11%) and central Scotland (8%). 

Although the report focuses on the importance of flood defences, surface water flood risk is also considered - the report advocates that other flood risk management measures, such as clearing culverts, are also funded appropriately.

Simon Waller, executive chair at JBA Risk Management, added: “The effectiveness of flood defences plays a significant role in the resilience of our communities and will continue to do so, especially with research suggesting that flooding is likely to increase in frequency and severity.

“We are delighted to have applied our flood science expertise in support of this important investigation that underlines the cost benefit of investment in flood defence schemes.”