Flood Legislation for SEM’s and Charities

The Government have announced that small and medium sized enterprises are not to be included in the Flood Re legislation.

In a document that closed the consultation period for securing the future availability and affordability of insurance in flood risk areas according to The Department for Environment, Food and Rural Affairs.  The document states that SME’s and charities will be excluded from the legislation.  However if your business is a micro business you will be included because you have a council tax banding.

Whilst there are way of obtaining insurance for certain small businesses such as naming a person rather than a business, Biba have become concerned at the recent exclusion conditions.  There are positives and there are challenges commented Graeme Trudgill Executive Director of Biba.

The challenges has been raised and there was currently no solutions for small businesses and Biba are continuing to work on it.  Biba would also be looking at the wording so that in the instance of a claim they would be covered in certain situations.  The consultation period closed on the 15th August 2012 and Biba has argued that SME’s need to be included within the legislation, as they had previously been covered by its predecessor, the Statement of Principles.  A welcome was the inclusion of buildings and contents insurance to domestic policies and the capping of excess of the Flood Re levy to £250-£500 per policy, however more concerns were raised about defining uninsurable properties.

Biba’s view is that is if someone is living at the property and are paying council tax then they should be included and be insurable.  This goes with what had been said by former secretary for Environment Owen Patterson that insurance would be available on all properties.

With the legislation now in draft there is already an update required, as it excludes properties that have been built after 2009, and with property owners now being able  to opt out of property registers  this would then show inaccuracy in underwriting.

The Water Bill which contains the relevant flood legislation will have faced a 2nd reading on the 25th November is Parliament.