As we know, the long anticipated not-for-profit scheme which was agreed between the Government and the insurance industry back in June 2013 has been delayed until April 2016. The reason sighted for the launch push back was the scale and the complexity of developing, building and testing the technology behind the scheme which involves up to 400 insurers.
While many flood-prone homeowners were banking on the launch of Flood Re this summer they now have to make the decision over the next year to either ‘run the gauntlet’ and hope their properties don’t flood or pay extortionately high insurance premiums for flood cover.
Flood Re delayed update: How does it affect tenants / rent?
However, while it seems common practice to seek out the cost and level of insurance cover when purchasing a new car, what is very apparent it’s rare for potential property purchasers to consider the cost and level of cover for home insurance when looking to purchase or even rent a property. This is even more important when purchasing or renting a high value property.
In the property purchasers shoe’s the conveyancing solicitor should highlight any flood risk issue when undertaking the searches as part of the conveyancing process where often a basic search is undertaken and may require a more detailed Flood Risk Assessment when there’s a high valued property at stake.
However, for the poor unexpected tenant they are none the wiser, given they haven’t been thought the conveyancing process and only usually find out once they have rented the property and at the point of purchasing contents insurance they are unable to obtain cover for flood. Onus should therefore be on the rental agent or landlord to make the tenant aware which is often not the case and there is no legal requirement for them to do so (our understanding at the date of writing this article).
An assessment of flood risk should always be undertaken when choosing a new home – whether rented or purchased.