The “shambolic” launch of Flood Re has put the organisation on the back foot, with increasing levels of confusion among brokers about what the programme does and doesn’t cover. But the organisation has informed Insurance Business UK that home workers, who account for nearly 14% of the UK’s working population, will not be left high and dry.
One of the biggest shortcomings of the Flood Re initiative in brokers’ eyes is the lack of cover for commercial premises, which has led to confusion over the eligibility of home workers.
Scott Hall, of brokerage Hall Commercial in Somerset, which has seen significant flooding of late, told Insurance Business UK he gets lots of home worker requests for insurance policies.
“Flood Re doesn’t apply to commercial properties, which is an even bigger stupid part of the initiative, and fewer and fewer insurers are providing home workers insurance quotes. So you get a situation where homes in a flood zone in which people are running a business have to get a home policy and business policy separately. So the home gets flood cover but the business doesn’t,” he said.
“In this case it’s not clear if something like a bed & breakfast is eligible.”
In the UK there are 4.2 million home workers as of March 2015, according to the Office of National Statistics. Around 5% of the total actually work at home or in the grounds of their home, while 8.6% use their home as a base.
In a clarification, a spokeswoman for Flood Re said that any property owners who pay council tax instead of business rates for their property would be eligible. So as long as the example bed & breakfast business falls within that requirement it would be eligible.
Brendan McCafferty, CEO of Flood Re, had warned that customers might not feel the effect of lower premiums right away and cautioned on the strict eligibility requirements. To apply for cover, the home must be in an area that is identified as at risk to flood, and buy-to-let units, business properties, flats in leasehold blocks, and dwellings built after 2009 are excluded from the scheme.
