Time is running out in fight for fair insurance

MORPETH’S MP has voiced his concern that the fight for fair flood insurance is being taken to the wire.

Across the country hundreds of thousands of flood victims, including homes and businesses in the market town, will face unaffordable increases in their insurance costs or risk losing cover altogether by next summer unless the Government and the Association of British Insurers (ABI) strike a deal about the issue within the next few weeks.

However, last week ABI described the talks to replace the Statement of Principles, which ends in June next year, as being at an impasse.

According to the body, the Government has refused to provide a temporary overdraft facility that would be used to pay claims if there were heavy floods in the early years of the new scheme, before it had built up its reserves.

Wansbeck MP Ian Lavery has now questioned Secretary of State for Environment, Food and Rural Affairs Owen Paterson about the industry’s comments.

The Minister told him that the Government wants to get an affordable system agreed which is also not a burden on the Treasury.

“That is not an easy series of demands to meet, but we are absolutely determined to keep working in a constructive manner with the ABI and we are waiting for the association to come back to us,” Mr Paterson told Mr Lavery.

The ABI model, which is similar to one put forward by Morpeth’s own flood insurance working group, involves a pool of money paid into by high-risk householders.

But to make policies affordable there would be contributions from the industry, Government and a Community Flood Levy where a small amount would be paid by all householders.

It claims a new deal has to be agreed by the end of the year so it can be put in place in time.

Mr Lavery said: “My concerns, like those of very many householders and business owners in Morpeth and Hepscott whose properties have been flooded, are that while there is plenty of talk from the Government about what it wants to do to help, we are rapidly running out of time for an agreement to be reached.

“Something has to be done, and done quickly, to give the peace of mind hundreds of thousands of homeowners and businesses across the country need to ensure they can continue to be able to afford insurance for their properties.

“The scale of the flooding problem in this country has escalated beyond all belief in recent years and Morpeth is just one example of communities being hit time and time again by the distress and devastation of homes and properties being swamped by flood waters.”

Mr Lavery added: “Hopefully, this week Northumberland County Council will approve the flood defence plans that will allow work to start on site early in 2013 to reduce the risks of Morpeth flooding in the future.

“But that work needs to be backed up by giving homes and businesses at any risk of flooding the assurance that they will also be able to afford to take out insurance.

“So I will continue to support the people of Morpeth by pressing the Government at every opportunity to reach agreement with the insurance industry.”

Meanwhile, the National Flood Forum has launched an e-petition on the Government’s website to highlight the issue.

It calls on the Government to ‘take immediate action that will ensure flood victims and flood hit communities can obtain affordable flood insurance after 2013, in the interests of individuals, communities and the national economy’.

More than 7,000 homes across the country have flooded since June, according to the Environment Agency’s most recent figures.

Chairman of the Flood Forum Charles Tucker said: “Government and the insurance industry have been talking about a replacement for the Statement of Principles now for over two years and these talks are still nowhere near a conclusion.

“They have to stop arguing and agree a new scheme. Flood-hit households need reassurance that they will be able to get affordable flood insurance in future.”

The petition can be found at http://epetitions.direct.gov.uk/petitions/42396