Future Flood and Water Management Legislation - Environment, Food and Rural Affairs Committee Contents


Written evidence submitted by RSA Insurance Group plc

EXECUTIVE SUMMARY

  With a 300 year heritage, RSA is one of the world's leading multinational quoted insurance groups. Within the UK, RSA is the largest commercial lines insurer and one of the UK's top three personal motor and household insurers, providing insurance direct through our More Th>n brand.

  In response to the increasing risk of flooding, RSA has developed our own Geographical Risk Assessment (GRA) tool, which uses height and flood risk data to assess the risk of flooding from natural sources down to an individual property level. This tool ensures that we are able to gain a good understanding of risks and means that some people can obtain insurance with RSA where they would have been excluded by other insurers who only use postcode level mapping.

  We are also proud of our response to flood events. During the 2009 floods, we were able to use the latest technology to pinpoint exactly which of our customers had been hit by flooding. This meant we were able to contact them pro-actively, in some cases even before they registered their claim and respond rapidly with direct assistance on the ground. We are also currently working with the World Wildlife Fund (WWF) on a unique project to promote the use of Sustainable Urban Drainage Systems (SUDS).

  Unlike most other European countries, the UK insurance industry is unusual in providing flood cover to homeowners as a standard feature of home and small business insurance cover, even to those in high-risk areas. This cover is currently provided as part of the Statement of Principles for flood insurance, which ends in June 2013. With the frequency, severity and costs of flooding expected to rise, this agreement is being reviewed and the Association of British Insurers (ABI) has stated that the present agreement will not be renewed in its existing form. The industry is looking to Government and Parliament to demonstrate a clear commitment to continuing, planned investment in spending on flood defences and we believe that such a commitment is vital to protect citizens and communities and prevent economic damage.

  The Floods and Water Management Act 2010 dealt with some of the issues related to flooding. However, RSA believes there are still gaps in effective flood and water management in England and Wales, including:

    — the setting of targets for reducing flood risk;

    — continued investment in flood defences;

    — an effective planning policy; and

    — the promotion of Sustainable Urban Drainage Systems (SUDS).

  RSA's response is designed to complement and add context to the submission provided by the ABI.

RESPONSES TO QUESTIONS

Q1:   Which of the key issues covered by the consultation into the draft Flood and Water Management Bill and by the Walker and Cave reviews should be taken forward as legislative priorities?

  In RSA's view, effective implementation of the Act is a higher priority than additional legislation. There are areas where uncertainty remains; for example, regarding the responsibilities imposed on local authorities. It is important that the measures yet to be enacted are properly delivered and that Government takes a holistic view.

Q2:   Which further policies are required to ensure flood and water management delivers optimum social, economic and environmental outcomes.

1)  Targets for reducing flood risk

  Over the past decade, there has been a shift from reducing flood risk to managing flood risk, both of which are very different things and carry very different risks for insurers. We need a statement from the Government of their vision for flood risk management in the future.

  RSA believes that ministers should set out targets to systematically reduce the number of properties at risk of flooding and articulate how this is to be achieved. This is something that is set out in the Climate Change Act (for carbon reduction targets) and such targets for flooding would give both insurers and communities the confidence that the Government is serious about managing this increasing risk.

2)  Continued investment

  For every £1 investment in flood defences, £8 is saved to the economy.[7] While the need for spending restraint is understood, continued investment in flood defences should remain a priority for Government.

  Any short-term restraint in public spending on tackling flooding should be coupled with prioritisation of the most high-risk areas for available funds.

3)  Proper planning controls

  RSA welcomed the introduction of Planning Policy Statement 25 (PPS25). However, we are concerned that implementation is not aligned across the country. Clear attention must be given to curbing construction in areas exposed to high flood risk. It is important that the "localism" agenda does not detract from the national picture.

4)  Widespread adoption of Sustainable Urban Drainage Systems (SUDS)

  The insurance industry is committed to working with the Government and other partners to explore new flood defence solutions. RSA has recently announced a global partnership with the WWF, part of which will result in a SUDS policy paper being published in November 2010. This will include recommendations for Government, insurers and developers, all designed to increase the use of SUDS. We would be delighted to share this paper with the Committee when it is launched.

  RSA is also supporting a project at Mayesbrook Park in East London, working with the Thames River Restoration Trust (TRRT) and the local council to restore the Mayesbrook River—an example of SUDS in action. Again, we would be delighted to brief the Committee in more detail and arrange a visit if that would be of interest.

  Our hope is that in promoting SUDS through the WWF/RSA policy paper and the Mayesbrook Park project, more developers will take up these techniques in their planning, providing communities with a more natural environment and insurers the confidence that flood risk is being factored into the planning process.

Q3:   Any issues related to the Flood and Water Management Act 2010 (including sustainable drainage systems (SUDS) and the transfer of private sewers and lateral drains)?

  RSA were pleased to see that the automatic right to connect was removed as part of the Flood and Water Management Act. However, surface water flooding remains a hard to quantify risk and we agree with the ABI's calls for sewerage companies to be properly consulted.

October 2010







7   "Flooding in England: A national assessment of flood risk", Environment Agency publication, 2009 Back


 
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Prepared 22 December 2010