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Insurance -
New report: 'Insurance premiums to rocket' - 05/11/2007
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Britons living in flood-risk areas will find insurance policies, including car and life insurance, becoming harder and harder to afford, it was claimed today.
According to research from information technology firm Computer Sciences Corporation (CSC), 90 per cent of insurance professionals agree that premiums will rocket if flood defence spending is not increased by the government.
Even more worryingly, 61 per cent said that the current practice of subsidising those insurance purchasers whose homes are vulnerable to flooding with premium funds from less risky customers will soon end.
CSC vice president John Maitz commented: "With margins under severe pressure, pricing more precisely for risk represents the principal strategy whereby [insurers] can hold on to market share without seeing their profitability diminish to an unacceptably low level.
"For households on flood plains these developments augur very poorly indeed."
The total cost of the flash floods which hit Britain earlier in the summer has exceeded £2.5 billion, figures from the Association of British Insurers show.
It is estimated that 2.2 million Britons currently live in areas vulnerable to flooding.
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Insurance
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Only Insurance Ltd is authorised and regulated by the Financial Services Authority, FSA registration number: 313649. Our registered offices are 1 Kings Avenue, Winchmore Hill, London N21 3NA, company number: 05223009. Telephone 0207 377 1805.
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