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House Insurance ?

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Anyone tried getting home insurance lately?  Seems many Banks and Bldg Societies are declining applications based on the EA's estimate of flood risk, and premiums are rocketing.

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can't say I have had problems, mind you for my house to be flooded out would mean that there would be some guy in a big wooden boat collecting animals around somewhere.

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Think you'll find, that some larger companies won't insure you, if your located on the flood plain - so not much chance for the Somerset Levels !

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Erm, if someone elses property has a much higher risk of catastrophic damage than mine - whether that be flood, fire, coastal erosion or even crime - why on earth shouldn't they pay more to insure it?

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That's not quite the point, many will find difficulty actually getting insurance, even if they want to, leaving to one side the question of affordability.

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You can ALWAYS get insurance for any risk. Maybe not from the mainstream providers, who have been forced by competition to streamline their procedures and exclude any identifiable additional risks in order to be able to offer the best possible price to the customers they actually DO want (ie. those least likely to make a big claim).

 

But it is always possible the get a quote direct from the underwriters at the insurance markets such as Lloyds of London. Of course, you've then got an underwriter and his staff working out the risks and therefore the premium for a single policy rather than for tens or hundreds of thousands of general policies - so it does cost more.

 

And there are already speciallist brokers who are dealing in flood risk and can get a decent price by bundling together large numbers of flood risk properties. The problem is that they will each then end up paying a similar premium so a property with a marginal flood risk will cost the same to insure as one which floods every 5 years.

 

The answer is probably to introduce a banding system to classify how severe the flood risk is on affected properties (just as insurance companies already do with crime rates by postcode and fire risk by building construction type), and for affected owners to expect to sign up for longer term insurance policies not expect to be able to jump to another company every year just by typing a few details into a comparisson site. If a broker or insurance company is trying to sell a five year insurance policy rather than just 12 months, then there would be much more scope for them to do the extra research and admin without too badly bumping up the price.

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