Flood Re

The news is full of warnings about climate change and rising sea levels. Flooding is well and truly on the agenda. But what if you’re already caught in the middle of it?

Thanks to a scheme called Flood Re, you can now access affordable insurance even if you live in a high-risk flood area. Here’s what you need to know about it.

The news is full of warnings about climate change and rising sea levels. Flooding is well and truly on the agenda. But what if you’re already caught in the middle of it?

Thanks to a scheme called Flood Re, you can now access affordable insurance even if you live in a high-risk flood area. Here’s what you need to know about it.

Written by

Anna McEntee

Insurance comparison expert

Reviewed by

Kate Hughes

Insurance expert

Last Updated

14 MARCH 2023

5 min read

What is Flood Re?

Flood Re is a joint reinsurance initiative between the government and the UK insurance industry. The non-profit scheme aims to give homeowners in high-risk flood areas access to affordable home contents and buildings insurance.

Created in 2016, Flood Re is planned to be in place until 2039, when a free market in flood insurance will be opened.

Why is Flood Re needed?

Around 5.2 million properties across the UK are at risk of flooding. Each year, flooding events cost the government more than £1 billion.

But for people living in high-risk flood areas, it’s becoming increasingly difficult to find affordable flood cover as part of their home insurance.

Check your risk of flooding on GOV.UK

Flood Re was set up to make flood insurance widely available and more affordable for households in high-risk areas. Without it, insurance providers probably wouldn’t insure people living in flood zones, leaving many households without cover.

That’s why the government stepped in and worked with the insurance industry to set up Flood Re. As a result, many households pay far less for their home insurance than they’d otherwise have to.

Did you know?

Since the Flood Re scheme was launched in 2016:

Almost half a million homes in the UK have benefitted from the scheme.
Four out of five homes with previous flood claims have seen a price reduction of more than 50%.
98% of homes at risk of flooding are now able to access quotes from more than 10 insurance providers backed by the scheme.

How does Flood Re work?

When you buy your home insurance, your insurance provider gets reinsurance from Flood Re. That way, if your home floods, your insurance provider can claim the money they pay you from the Flood Re fund.

Flood Re doesn’t affect you day to day because you’ll still deal with your insurance provider in the same way you always have. But behind the scenes, your insurance provider is paying the Flood Re part of your insurance premium.

How is Flood Re funded?

Flood Re is funded by the insurance providers themselves. All UK home insurance providers must pay into the Flood Re pot. This makes things fair.

Up to the end of March 2022, the annual pot, or ‘levy’, was £180 million. This changed to £135 million from 1 April 2022. Insurance providers use these funds to pay the flooding claims to qualifying households.

Am I eligible for Flood Re?

Possibly. If your home is in a flood-risk area, you might have been told that you won’t get insurance. But don’t give up hope – your home may be eligible for Flood Re. To qualify:

The property must be in a council tax band
It must have been built before January 2009
It must be used for residential purposes – you or your immediate family must live there some or all of the time
Your insurance policy also must be in your name.

Still not sure if you’re eligible? You can check if you qualify using Flood Re’s handy tool.

Who isn’t eligible for Flood Re?

Some buildings aren’t eligible for Flood Re – usually those used as businesses, rather than homes. If you’re unsure, it’s worth checking.

Common exclusions are:

Buy-to-let properties that don’t meet the above criteria
Guest houses and B&Bs that pay business rates
Housing association properties
Farm buildings
Static caravans used as holiday lets.

How does Flood Re help homeowners?

Flood Re allows insurance providers to offer you more competitive prices
It means you don’t have to worry about getting cover if you live on a flood plain.

How does Flood Re help tenants?

If you rent a home in a flood-risk area, your home contents insurance policy could be backed by Flood Re too.

You should also check that your landlord has insurance cover in place, because most landlord policies offer help towards rehousing costs if a home becomes unliveable in because of an insured event like a flood or fire.

Which insurance providers take part in Flood Re?

Lots of insurance providers take part in the scheme and you can find the full list on the Flood Re website.

As always, it pays to shop around to see who can provide the right policy for you.

What is Build Back Better?

In April 2022, Flood Re launched an additional scheme – Build Back Better.

Under the new scheme, people can claim up to £10,000 from participating insurance providers to install flood resilience measures, over and above works to repair damage after a flood.

These could include:

Raising electrical sockets and white goods above floor level
Installing self-closing air bricks and flood-resistant doors
Replacing flooring with waterproof tiling and grout.

The aim of these measures is to reduce the impact of future flooding, enabling families to return to their homes much sooner after a flood.

Be aware that only some polices offer ‘resilient repairs’ through the Build Back Better scheme. So far, providers signed up to the scheme include Ageas, Aviva, AXA, Bank of Scotland, Halifax, Hiscox, Lloyds Banking Group, LV= and NFU Mutual.

Frequently asked questions

What is reinsurance?

Put simply, reinsurance is ‘insurance’ for insurance providers. It’s what the ‘Re’ in Flood Re stands for.

All insurance providers take risks by insuring us – after all, they don’t know how much they could end up paying out.

When a customer looks risky – for instance, if they live in an area that’s prone to flooding – the insurance provider can refuse to take them on.

Or they can sell that risk on to another insurance provider. This is known as reinsurance.

Are sheds and outbuildings covered by Flood Re?

Yes. If sheds and outbuildings are included as part of your main residence, they can be covered by Flood Re as long as the main residence qualifies. This includes sheds or outbuildings built after 2009.

Why aren’t business premises covered by Flood Re?

Business insurance is very different from home insurance, and a more complex insurance product. Businesses at risk of flooding are on a much smaller scale nationally than domestic properties. That’s why Flood Re’s focus is residential properties.

However, the British Insurance Brokers’ Association (BIBA) has launched a similar scheme that may help small businesses at risk of flooding.

Am I eligible for Flood Re if I work from home?

If you pay residential council tax, your property doesn’t attract business rates and is mainly used as a private home, then yes, it may qualify for Flood Re.