Direct Line Cites 2008 Figures in Latest Warnings

The floods of 2009 have seen many leading insurers appearing out of the word works to urge people to make sure they are covered for home insurance. Car Insurance experts have also advised motorists to drive carefully unless they want to see damage caused to their vehicle and a rise in their car insurance premiums.

But Business Insurance experts have also been adding their own views to the flood issue, citing statistics that point to the damage faced by SMEs in 2008 as a result of flooding.

They show that as many as 112,000 small businesses were in some way affected by floods that occurred last year, which accounts for 11% of the total. The research was carried out by Opinium Research, who carried it out on behalf of insurance provider Direct Line in January 2009.

Perhaps even more worrying was the figures that highlighted a third of businesses that were not only affected by flooding, but were facing even bigger problems due to a lack of adequate cover.

In many cases the problems came about from flood waters entering premises, with close to half of SMEs affected by such situations. However, flooding can affect businesses in a number of ways, such as suppliers or employees being flooded, causing a knock on effect. Around 31% of businesses were left with no ability to operate as a result of suppliers becoming flooded in 2008.

“Flooding poses an increasing threat to all businesses and householders, as last year’s storms and severe weather have demonstrated,” said Kate Syred of Direct Line. She adds that businesses should do all that they can to ensure they are properly protected by Business Insurance.

“It is vital that small business owners and sole traders take steps to protect themselves against unforeseen incidents, like flooding wherever possible, particularly at a time when finances are already stretched.

“By having protection in place, it could not only reimburse businesses for losses as a result of flooding, but it can also provide much needed peace of mind during such turbulent times.”

Businesses are clearly facing a large bill as a result of not being adequately protected, so with the 2009 floods still causing havoc in Cumbria and Scotland, perhaps it is time to take the necessary steps.

Source: Direct Line Press Release July 2009

Victims of Recent Downpours Facing Spiralling Excesses

Reports in both the Guardian and on the BBC News website are highlighting the rising costs of insurance premiums for those that have been hit hard by the recent flooding in areas such as Cumbria.

The North West County has been amongst numerous places across the United Kingdom to suffer at the hands of intense flooding and insurance providers have used it as a reason to express the need for adequate cover in such conditions.

However, despite home owners carrying out various tasks to protect their home, as well as doing their best to minimise the damage by moving possessions to higher levels, insurance companies are cited to be rarely helping them.

As a result, despite their best efforts, there are homes that are becoming virtually worthless and impossible to sell on because of the insurance excesses caused by flooding.

As a result the National Flood Forum, a charity that provides advice and support to people who are victims of flooding, is urging insurance companies to change its attitude towards flood victims and protection measures that are in place.

They feel that it is unfair that despite work to protect the home, some of which can stretch into tens of thousands of pounds, high insurance premiums and excesses are still being applied to properties.

The Guardian newspaper has spoken to various people that have succumbed to flooding, citing insurance figures that have more than doubled since 2008. They refer to AXA, who have since imposed a maximum limit for flood excesses of £10,000.

The insurance industry has insisted that they do not increase the flood excess on the majority of properties. A press release from MoneySupermarket.com earlier in November pointed out that insurance providers have improved their handling of flooding in recent years and home owners should still ensure they are taking preventative measures to minimise damage.

Earlier in the month, the BBC also pointed out that the government and the insurance industry had agreed that the providers would continue to insure homes that are at risk of flooding, with the real difficulty being the switch to another provider in the future.

Sources: Guardian.co.uk, BBC News and MoneySupermarket.com Press Release