Flood Re, the UK’s government-backed flood reinsurance scheme, said that it has provided reinsurance to back almost 130,000 insurance policies since its launch and assisted homeowners to get more quotes and options when looking to purchase insurance.
At the end of its first full year of operations, Flood Re said that 127,326 policies have benefited from backing provided by Flood Re since it was launched on 4th April 2016.
In that period a relatively benign spell of weather meant that there have been few claims to date, Flood Re said.
So profitability certainly isn’t an issue, helped by the benign weather, with Flood Re reporting a pre-tax profit of £130m for the year, due to having collected £180m of levy income and a gross written premium of £28m.
Operating and administrative expenses came to £15.7m for the year, while Flood Re’s invested and liquid assets reached £157m and its net assets (IFRS) were £98m.
Andy Bord, Chief Executive of Flood Re, commented; “We’re encouraged by the number of policies that we have backed since launch and the significant increase in both affordability and availability of flood insurance.”
“Additionally, Flood Re’s profitability demonstrates careful management of the Scheme and will allow us to build up its reserves for future flooding events and reduces the likelihood of having to call an additional levy. Although there have not been any events on the scale of the 2015-16 winter flooding since Flood Re’s launch, we remain ready for the future.”
The flood reinsurance pool also said that research showed that flood affected communities have benefited from more insurance choice since the launch of Flood Re.
Statistics show that four out of five householders with previous flood claims saw a reduction in quote prices of more than 50%.
It also shows that before Flood Re’s launch only 9% of householders who had made prior flood claims could get quotes from two or more insurers, with none able to get quotes from five insurers or more. But now, 95% of those have access to two or more quotes and 84% can get quotes from five or more insurance providers.