Flood Damage from UK’s Winter Storms to Cost Insurers $2 Billion: ABI

May 25, 2016

Flood damage in Britain from winter storms has resulted in claims for more than 15,000 homes and businesses and is likely to lead to pay-outs of 1.3 billion pounds ($1.9 billion), the Association of British Insurers estimates.

Three winter storms in northern Britain resulted in average household claims of 50,000 pounds [$72,754], the ABI said on Wednesday, compared with 31,000 pounds [$45,108] during 2013/2014, and an average claim of 25,000 [$36,377] to 30,000 pounds [$43,652].

The higher claims reflected extensive flood damage in some locations, the ABI said, adding that 85 percent of claims had been fully or partly paid out so far.

Flood Re, a government and industry scheme to cut insurance costs for homes in flood-risk areas, launched last month, but will only apply to policies taken out from April 2016.

The scheme applies to households, but not businesses, and is partly funded by a 180 million pound levy on the insurance industry. Insurers are expected to pass the levy onto household insurance policies across the country.

($1 = 0.6846 pounds) (Reporting by Carolyn Cohn; editing by Alexander Smith)

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