Last year the establishment of FloodRe brought huge relief to households up and down the country as flood insurance for domestic properties was now to be made available throughout the UK – with a small number of exceptions.
However, the scheme introduction meant huge problems for business as any business premises, including mixed use such as pubs, retail with living accommodation and even buy to let houses were denied the benefits of the new arrangements.
As this meant that the long standing agreement between the insurers and Government ended, commercial underwriters were now free to apply whatever terms they considered reasonable in respect of flood cover for business properties, although in the main this meant flood insurance being excluded. This caused a drastic reduction in options open to commercial policyholders and in this area, businesses in Southampton, Romsey, Winchester and parts of Fareham began to realise the potentially serious risk to their ongoing success, especially as there were various and in many cases, inadequate flood mapping tools used by insurers.
However, this dark episode is now virtually behind us as Insurance Brokers have worked hard to reduce the burden on business and there are now two widely used options available to businesses.
The first is a simple Excess Insurance policy – providing a standalone cover which only insures the amount of the flood insurance excess imposed by an insurer which in some cases have been as high as £50,000. This means that a policyholder can opt for an insurer of choice which is particularly important if an Insurer/Policyholder relationship has been built up over a number of years or the business concerned would find it difficult to access cover elsewhere.
The second option is that the British Insurance Brokers’ Association (BIBA) has now announced the launch of a new commercial insurance scheme for businesses that will also include flood cover for many commercial premises and let properties located in areas at risk from flooding.
After detailed negotiation with the insurance market including flood risk specialists and brokers , the facility was created. This co-operation has made available an innovative product that will help meet the usual commercial insurance needs of small and medium sized clients (SMEs) and provide flood cover for many businesses risks. Backed by the A+ rated security of Lloyd’s underwriting capacity, an advanced mapping facility pin-points exactly the location and features of an individual property. Having this degree of specific and detailed risk reflective information allows each individual business or property to have insurance that is based on its own specific risk.
Innovatively, the scheme also offers a high degree of customer choice giving the option to ‘buy-back’ any flood excess that is applied because of the business location meaning customers can choose the amount of risk they want to bear themselves.
The new product is exclusive to BIBA members and as well as including all of the usual insurance covers a business normally requires, it is flexible in its approach to flood cover.
Is your business having difficulty with obtaining or affording flood insurance? Contact Knightsure today!