Bringing affordable insurance to homes at risk of flooding

An innovative solution to improve the availability and affordability of flood insurance, likely to benefit 350,000 households.

Issue

Following the increase in the number and severity of flood events in recent years, the continued general availability of domestic flood insurance at reasonable cost has come under a great deal of pressure.

Insight

Flood cover on home insurance can be delivered in a new way, through a not-for-profit scheme, that’s funded by insurers.

Our approach

Flood Re is one of the most significant innovations ever to be introduced into the home insurance market.

It has been designed to make affordable insurance cover widely available to UK householders who live in private residential homes at risk of flooding. 

Discussions about setting up Flood Re began in 2009, but it was a further 5 years until the Water Act 2014 was passed, which paved the way for the Flood Re scheme.

Capita was awarded the contract in January 2015 to design, build and operate the start-up reinsurance business.

Flood Re enables homeowners  and tenants to find affordable insurance, if an eligible property is at risk of flooding. It also helps local authorities and communities across the UK to be better prepared for flooding and creates a ‘level playing field’ for UK insurers, which means they can still offer homeowners an affordable range of appropriate policies.

The impact

The Flood Re scheme went live in April 2016 and in the first year ceded 135,000 policies.