Landlords left to swim against the tide
Published: 27/01/2014
Flooding insurance is becoming a growing concern for landlords after it was revealed the latest government plans seemingly exclude landlords and tenants.
Flood Re is the government’s new flood insurance agreement which will enable homeowners who own a flood-risk property to acquire affordable insurance. However the scheme appears to exclude properties where the owner does not reside it in i.e. rental properties.
The government documents reads:
“For properties to be eligible for Flood Re, they would need to be insured in the name of an individual; they would need to have been allocated a Council Tax band; be used for residential purposes; have an individual premium; and be occupied by the policyholder, or their immediate family.”
The exclusion has prompted the Residential Landlords Association (RLA) to raise its concerns directly. RLA Policy Director, Richard Jones, has written to the Environmental Secretary, Owen Paterson MP:
“This is an extremely disturbing development and poses significant threats to the ongoing viability of those areas where this is a significant risk of flooding. Insurance may not be obtainable at all or only obtainable on prohibitive terms. It could place landlords in breach of the terms of their mortgages.
“The government is looking to support private rented housing but this will have the opposite effect.”
The RLA is awaiting a response.
While there is obvious concern surrounding the insurability of existing properties, landlords need not worry about future purchases as Head of GW LET, Rob Denman explains:“With so many recent examples springing to mind, it is no surprise that landlords are far more eager to check the flooding risk of any new properties.
“But while some solicitors will charge extra in order to answer your concerns, Goldsmith Williams does this as standard; we automatically conduct an environmental search on purchase cases as part of our all-inclusive search fee.
“This will tell us if the property is in the vicinity of a floodplain. Should this be the case then we will order a flood risk report and share this with you and your insurer – all at no extra cost.”
Get a free, no obligation quote for our buy to let conveyancing service which, unlike some solicitors, includes all fees so you aren’t met with any nasty hidden costs down stream.
Content correct at time of publication