The massive flooding of 2007 led to insurance claims totalling £3 billion and doubts about whether insurers would cover flooding at all in future.
Those doubts remain as the pact (mentioned in my post Flood Defence Deficit Could Sink Economy) between the government and the insurance industry, known as the Statement of Principles, ends in 2013.
The pact currently guarantees cover to small businesses (although not commercial premises in general) and households (but not new builds) at risk of flooding.
Contrary to what you might think, flooding doesn’t just happen to properties close to rivers or the sea; in fact 70% of the property damage caused by the 2007 floods was caused by surface water.
Surface water flooding occurs when heavy rainfall overwhelms the drainage capacity of the local area.
It can be severe in areas with impermeable surfaces, for example in urban areas, where drainage systems may struggle to cope; as well as when heavy rain falls on already saturated ground.
This flooding often takes place miles away from recognised flood plains.
The 2009 report, “Flooding in England”, from the Environment Agency (EA), showed for the first time that more properties are at risk from surface water flooding than flooding caused by rivers or the sea.
The EA's website, which has a lot of useful information on flooding generally, says surface water floods are difficult to predict and pinpoint; much more so than river or coastal flooding.
The EA’s own flood map doesn’t even show the risk of flooding from surface water.
Flood consultants, however, have built digital terrain maps to model and record the risk of surface water flooding, and this is where insurers get most of their information. The two leading consultants are JBA Consulting and Risk Management Solutions.
Sophisticated modelling by flood consultants helps to assess the risk from surface water flooding. At the moment, however, this information is not freely available on the EA website.
Landowners, or potential buyers or tenants, can access similar information by paying for a flood search and there are several available on the open market.
On a practical level, the campaign Know Your Flood Risk has a mission to help raise awareness of the issue of flooding and encourage practical guidance and support to help protect homeowners and property professionals against the risks.
However, the availability (or not) of flood insurance has important implications for those with an interest in property, not just for obvious reasons; for example it may well determine whether or not a property is mortgageable.
And with leasehold property, as I explained in my previous flooding post, landlords and tenants need to anticipate what would happen if their property became damaged by flooding and flood insurance were no longer available.
Is it right that the future availability of cover for such a widespread risk should in future be left to the vagaries of the open market?
Given the risk that flood insurance will become harder to obtain, greater thought may need to be given to flood prevention.
The Public Accounts Committee, as I mentioned in my previous post on flooding, is concerned that in the matter of flood defences generally, there is no clarity about where the buck stops and who is ultimately responsible for managing the risk.
On the question of surface water however, the Department for Environment, Food and Rural Affairs (DEFRA) is consulting on proposals for compulsory sustainable drainage systems (SuDS) in new and redeveloped sites in England, which it wants to introduce from 1 October 2012.
SuDs aim to reduce the rate and volume of surface runoff from developments.
DEFRA’s proposals follow the Flood and Water Management Act 2010 which requires certain drainage systems for managing surface runoff (including rainwater, snow and other precipitation) to be approved before any construction begins.
A SuDS Approving Body (“SAB”) will be set up to approve and ultimately adopt SuDS, which will have to be designed, built and operated in accordance with National Standards (the consultation asks for views on these), and there will be a requirement for drainage systems to be approved by the SAB before they can be connected to public sewers.
The consultation ends on 13 March 2012; for more information follow the link.