Ensuring your flood claim goes through smoothly

After the wettest June since records began in 1914 and just as flood waters have started to subside, don't get too comfortable because it hasn't stopped yet, according to the Met Office. It says there's more rain to come over the summer and more so in the north than the south.

New Prime Minister Gordon Brown has promised £14 million in aid but this is barely one per cent of the estimated bill for flood damage. The Association of British Insurers (ABI) now reckons that the cost of the damage caused by the devastating rain in June is £1.5 billion and that 27,500 homes and 7,000 businesses have been affected.

Abbey, for one, estimates that on 24 June alone, 8,600 claims were made for floods and bad weather against a total of 13,700 in an average year. Before you make a claim, first check that your buildings and contents policy is up to date because, sadly, 257,000 claims are turned down a year because the home owner is underinsured. If affected by flood or storm damage, immediately ring your household insurer to make sure you are fully covered.

Think before you put in an insurance claim

If you have suffered only minor damage think carefully before making a claim and how it could affect the future costs of your premiums. As you will have a history of flooding your premiums are likely to go up, you could find it difficult to get cover in the future and the minimum excess level could dramatically increase.

In fact, an estimated two million properties may be classified as being in 'high risk' areas. Some 400,000 cannot be insured against flooding now. This figure could rise to more than a million homes, taking into account all those built on flood plains.

In the meantime, as the flood waters have started to drain away, a massive clean up is now underway and insurers are still dealing with claims from household insurance policies. However, if you are one of the unfortunate people who has made a claim on their household insurance, expect a delay.

Businesses, too, can expect delays for flood claims and the Federation of Small Businesses and put aside £0.5 million for interest free short-term assistance loans to its members up to £5,000 for each business to get them back up and running as quickly as possible while they wait for their claims payments.

Largest claims exercise ever

In almost military proportions, insurers have been organising themselves for one of the largest claims exercise ever. Companies such as Zurich, which has 2,600 claims in the last ten days in June, has been flying in loss adjusters from across Europe, the US and Australia to deal with the assessment once the floods have cleared.

09 July 2007 © Moneyextra.com

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