Victims pay the price

MANY Morpeth flood victims are paying the price with higher insurance premiums.

The Morpeth Flood Action Group (MFAG) carried out a questionnaire of homes that were flooded in September 2008 and some of those in the town that were not. A total of 362 returns were received.

It found that the average increase in building and contents premiums between 2008 and 2010 for owner-occupier households that were flooded was 71 per cent – up from about £400 to more than £600.

This compared to a nine per cent rise for non-flooded households within flood risk postcode areas and a small reduction for other homes outside the risk zones.

The survey report says: ‘The similarity of average premiums across the board in 2008 may indicate that, at that time, the insurance companies did not have an accurate assessment of the flood risks for the majority of Morpeth properties and the 2008 flood alerted them to those risks.’

Another concern is the excesses that companies are requiring for flood risk insurance, with 20 per cent having excesses of more than £2,500 and 14 per cent being hit with £5,000 or more.

‘The insurers that have imposed high excesses also have the highest premiums,’ concludes the report. ‘This suggests that certain companies are moving towards a more risk based approach to setting premiums and excesses.’

It also says there is little evidence that insurance companies have recognised the efforts of households which elect to reduce flood risk by installation of flood-resistant products.

MFAG is part of a working group, which also includes Morpeth Town Council and Morpeth and District Chamber of Trade, that has come up with a draft proposal for a new national flood insurance scheme and this survey will contribute to its evidence.