Flood Re, a national scheme to support households at the highest risk of flooding, went live today following authorisation last week by the Prudential Regulatory Authority and Financial Conduct Authority.
Search provider SearchFlow warned that not all properties would be eligible to benefit from the not-for-profit scheme, ‘and due to the detailed criteria defining whether your property qualifies, it is now a lot less clear throughout the conveyancing process as to how to proceed’.
Only ‘interpreter’ flood reports flagging potential eligibility for Flood Re would ‘sufficiently’ protect homebuyers, the search provider warned.
Managing director Greg Bryce said: ‘Whilst the Flood Re scheme will offer much-needed protection to homebuyers purchasing properties in flood-risk areas, it has certainly added another layer of complexity to the homebuying process.
‘It is now very important that we provide flood reports that define the potential to cede properties into Flood Re and outline clear guidance on what it means for the homebuyer and their insurance availability.’
A guide published by the Department for Environment, Food and Rural Affairs states that Flood Re will be a not-for-profit reinsurance body ‘run and managed by the insurance industry’.
Insurers will maintain a ‘direct relationship’ with their customers, with policyholders paying premiums and making claims directly to the insurer.
Read more here: http://www.lawgazette.co.uk/law/new-flood-protections-give-rise-to-conveyancing-fears/5054551.fullarticle
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