Author: FSB Insurance Service
Tags: Flood Protection
Our friends at FloodFlash are experts when it comes to flood risk. Their cloud-based underwriting platform relies on the latest data science to make sure they can provide effective, affordable insurance to their clients.
When it comes to flood risk, many have an “it won’t happen here” attitude. We quizzed the experts on the key flood statistics that they think characterises the state of flood risk in the UK. And what they use to bring it home to the people that need flood insurance, even when they don’t know it. Here’s what they said.
#1 – 1 in 6 UK buildings are at risk of flooding
This statistic, first reported by Environment Agency released in 2009 (pdf available here), gives a baseline for UK flood risk. Seems high right? FloodFlash decided to test the number. They used Ordnance Survey, The Environment Agency and JBA data to to see whether the 1 in 6 number was true for commercial buildings too. The answer? It almost exactly was.
The FloodFlash study revealed the same result. According to the Commercial Risk Report that they published off the back of the research 236,000 (or 15%) of UK commercial buildings have a significant flood risk.
This map shows every commercial property with a flood risk in the UK in blue. It was created as part of the FloodFlash Commercial Risk Report (available for download here - FloodFlash Commercial Risk Report).
#2 – Surface water flooding is the greatest risk with 2.8m properties at risk
Many people think that flooding is reserved for coastal or riverside property. Unfortunately for many business and homeowners that just isn’t the case. The widest source of flooding in the UK is surface water caused by rainfall and storms – often known as flash flooding.
This statistic is important because flood risk isn’t always easy to see. It’s worth discussing your flood risk with your broker at renewal, even if there isn’t an obvious source of flooding near your property.
Excess rainwater can very quickly build up and cause flash flooding. In fact, it’s the most prolific form of flooding in the UK.
Surface water flooding (as it is known by experts) is caused by large amounts of water putting too much pressure on water systems. When too much rain falls, it does not drain away through natural drainage systems. Human development has made the phenomenon even worse in recent years. When we build on natural floodplains or drainage systems, it means water has fewer places to go. So when lots of rainfall comes around, the floods can be far worse.
#3 – 52% of smaller firms on floodplains do not have flood insurance
FloodFlash aren’t the only people that do their research. In fact, the FSB has extensive knowledge of UK flood risk and the impact it can have on small businesses. In 2015 we revealed that 75,000 smaller firms at risk of flooding have difficulty finding adequate cover. Worse still, 52% of smaller firms on floodplains don’t have flood insurance. This is a big number, and a huge problem. Businesses can’t get insurance under the Flood Re scheme. Fortunately, FloodFlash was launched in 2019 to help combat the issue. Get in touch with your broker, or click here to get started with a FloodFlash quote and protect your livelihood with their tech-enabled cover.
It’s not just the UK that has this problem, the protection gap is a global issue. It is estimated that flooding causes $50+bn of damage every year. When insurance covers $9bn of that damage – it’s clear that innovation like FloodFlash will become more important in the future.
#4 – 40% of SMEs close for good after a catastrophic flood
99% of the UK private sector is SMEs. That’s almost 6 million businesses. Many of these businesses don’t have large cash reserves that mean they can self-insure. When cash-strapped businesses that want to invest every spare pound back into the business get flooded, recovery can be very difficult.
Fact number 3 shows why the FloodFlash founders decided to start the company. This statistic shows why the brokers at the FSBIS are committed to making sure that businesses who have access to FloodFlash can get a quote. Together we constantly look to raise awareness around the risk that flood poses to small businesses. That way they are better equipped to counter the risk and make themselves financially resilient.
#5 – If you have flooded, you are 6x more likely to have a mental health issue
The fifth and last stat was published by Public Health England after successive floods. It represents a hidden cost of flooding to those that experience it, whether they are businesses or homeowners. They surveyed over 2,000 adults in 2013 and 2014. Depression, PTSD and anxiety were 6 times more likely to occur in the people that had experienced flooding.
The mental health impact of a flood remains long after the water is gone and the clear-up has finished.
Public Health England’s research sheds important light on what flooding can do to people and communities. Support and innovation in the flood risk sphere is so important to reducing the implications of flooding.
Flood is a problem. What next?
Flooding is a big issue in the UK. Climate change may exacerbate that in the future, but it’s important to face the problems caused by extreme weather right now. Recent events in Europe and China show that floods are current, and need to be taken seriously.
The good news is that tech and insurance innovators are alert to the issues posed by flooding. Companies like our partners at FloodFlash are paving the way for better insurance products.
Get in touch with us today to explore your options and make sure you’re ready for the next flood coming your way.
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