The lack of agreement between the government and ABI over a replacement to the Statement of Principles is the biggest concern for household insurers,according to business advisory firm Deloitte, www.insurancetimes.co.uk reported on Friday.
Deloite insurance partner David Hindley warned the government flooding had produced very significant claims for insurers, adding that the lack of agreement between the government and industry over a replacement to the Statement of Principles was causing concern both for insurers and homeowners.
"The high rainfall of 2012 was a further reminder to insurers that flood risk has not gone away and insurers will have to consider whether their flood risk data and models are detailed enough to make effective pricing and underwriting decisions for individual properties," Hindley said.
"If an agreement is not reached, people in high-risk areas will find it difficult to find affordable flood cover."
Hindley's comments came on the same day the Met Office confirmed that 2012 was the second wettest year on record and warned that extreme rainfall in the UK appeared to be increasing. It said statistical evidence showed an increase in the number of days of heavy rainfall since 1960.
Extreme rain is defined as rainfall you would expect once in 100 days. While there were big swings in the level of rainfall from year to year, the overall trend was upwards since 1960, the Met Office added. Last year, extreme rain fell about once every 70 days.
