Source · Select Committees · Public Accounts Committee
Recommendation 25
25
Accepted
Unclear how many high-risk properties benefit from Flood Re insurance cover
Recommendation
Defra told us that Flood Re is working well: in 2022–23, Flood Re provided cover for 265,000 household property policies and more than 500,000 households have benefitted since it launched. Before Flood Re was introduced, 9% of policyholders with a prior flood claim could get quotes from two or more insurers and none could get quotes from five or more. Most policyholders can now get over 10 quotes.55 The Committee has concerns over the number of high-risk households Flood Re protects. It is unclear what number of the 265,000 policies ceded to Flood Re in 2023 were from the top 2% of at risk properties nationally.56
Government Response Summary
The government agrees with the committee's implicit recommendation and will write to the Committee by January 2025. This communication will follow Flood Re's Quinquennial Review in July 2024, which will make recommendations for the Secretary of State to consider.
Government Response
Accepted
HM Government
Accepted
6.1 The government agrees with the Committee’s recommendation. Target implementation date: January 2025 6.2 The department will write to the Committee by January 2025. 6.3 Regulation 27 of the Flood Reinsurance (Scheme Funding and Administration) Regulations 2015 sets out that Flood Re must produce a report at least every five years which reviews the scheme, considering total levy and reinsurance premium thresholds and the need to manage transition by 2039. Flood Re intend to publish their next Quinquennial Review in July 2024 making recommendations, which the Secretary of State will consider.