Norwich Union implements new approach to floods

Article date: 23 August 2001

From 1 September, Norwich Union will increase the number of‘refer’ postcodes for properties, which have beenidentified as being at high-risk from flooding.

This reflects the increased frequency and cost of severe weatherevents across the UK and will affect the insurer’s range ofhousehold products including its Home Plus and Your Housepolicies.

In addition, Norwich Union will be lobbying the Government toreverse the under-investment in flood defences in order to controlpreventable flooding and to help ensure the continued availabilityand affordability of insurance for customers in flood prone areas.The insurer is continuing to call for a rigorous review of flooddefence planning and funding.

Nick Pierson, head of household products for Norwich Union,commented: “We have seen an upward trend in flooding inrecent years and the Environment Agency predicts a ten-foldincrease in flood risk over the next century. Coupled with this, ithas become clear that planning, maintenance and funding of flooddefences is currently inadequate to protect against major flooding– a fact recently acknowledged by the National AuditOffice.

“We’ve conducted an in-depth review of floodinsurance considering the potential risk of flood across the UK,using information from both the extensive database created by ourmerger last year and the advice of independent environmentexperts.

“As a result, we’ll be adopting a more focusedapproach, which takes into account both the risk of flooding andinformation about the adequacy of flood defences. Enquiries for newbusiness in high-risk areas will be referred to our underwritingteam and renewal terms for existing customers will now reflectthese factors as well as their claims experience.

“These changes are in line with the ABI flood agreement.However, in the absence of an integrated and ongoing Governmentstrategy with adequate funding, Norwich Union needs to take a moredetailed approach to flood assessment.”

Pierson concluded: “Insurance can only compensate floodvictims to a certain degree, it cannot compensate for the emotionaltrauma that flooding can cause. On behalf of our customers we wantto tackle the root cause of the problem.

“We believe that Government action is needed to ensurethat, as far as possible, no one has to suffer trauma or damage totheir property through inadequate flood defences. We’ll betaking a leading role in working to influence Government andindustry bodies, to help ensure that steps are taken to minimisethe damage caused by predictable and preventable floods.”

Press contact: Jenny Chapman on 08703 666 864.

Notes to Editors

  • Norwich Union Insurance is the UK’s largest generalinsurer – insuring one in five households.
  • CGU plc and Norwich Union plc merged on 30 May 2000 to createCGNU plc, the UK’s largest insurance group and one of thetop-five insurers in Europe with substantial positions in othermarkets around the world, making it the world’s sixthlargest insurer based on gross worldwide premiums.
  • CGNU’s principal business activities are long-termsavings, fund management and general insurance, with worldwidepremium income and retail investment sales from ongoing businessof over £27 billion and assets under management of more than £200billion.
  • From October 2000, the combined life and pensions, generalinsurance and retail fund management businesses in the UK operateunder the Norwich Union brand, while the institutional investmentbusiness operates under the Morley Fund Management brand.
  • A selection of images are available from the CGNU Newscastsite at www.newscast.co.uk
  • Norwich Union’s news releases are available on theinternet on this site
  • Norwich Union Insurance Limited Registered in England Number99122 Registered Office 8 Surrey Street Norwich NR1 3NG.
  • Member of the General Insurance Standards Council.

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