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Daily Insurance Industry News
Tuesday 11th of December 2018
September 14, 2007

Environment Agency Call For Withdrawal of Flood Insurance

by Stewart Douglas

Story link: Environment Agency Call For Withdrawal of Flood Insurance

The Environment Agency has today called for insurers to refuse to cover those that build property on flood plains after planning permission has been refused, in a measure to deter businesses that have previously ignored the decisions of planning departments.

The call came from Baroness Young, the agency’s Chief Executive, much to the disgust of insurance industry insiders, who have branded the move as ‘incredible’ and beyond the remit of the insurance industry.

Some industry analysts have been bold enough to claim the announcement to be a ‘smokescreen’ to hide decades of less than adequate flood defence investment by the government, after the unorthodox move by the Environment Agency today.

The National Audit Office recently reported that flood defence mechanisms in the UK had suffered as a result of under investment, and at present the risk of future flooding remains high and the risk of damage to property also remains strong.

After widespread damage earlier in the summer as a result of some of the worst flooding on record, the defences against future flooding in high-risk areas are still inadequate according to the report by the National Audit Office.

The call for insurers to effectively reinforce local authority planning law has incensed the industry on the whole, who have suggested that planning regulation is not a job for the insurance industry.

Insurers have warned that they may withdraw insurance policies in high risk flooding areas if the government continues its lack of investment in flood defence.

However, after today’s announcement they have been quick to underline that they will not support the Environment Agency’s claims, and will not act as an authority over planning regulation. It has also been warned that by withdrawing cover for flooding protection, this could result in widespread economic unrest if the scenes of early summer were to be repeated.

 

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