Rising numbers of insurance claims during floods

Car insurance premiums unlikely to rise due to the weather

The ‘old year’ did not end well for thousands of home owners and drivers, with AA Insurance reporting that it had taken around 1,000 home storm and flood claims and 130 car claims as a direct result of the Christmas gales.

In addition, the AA’s Special Operations team, whose patrols are qualified in flood rescue and whose Land Rovers are specially adapted to operate in flood water, have rescued more than 1,100 vehicles stuck in flood water (since December 23) – a disproportionate number of them being 4x4s.

Many drivers had ignored ‘road closed’ warnings.

Simon Douglas, director of AA Insurance, says that the majority of home claims have been for dislodged tiles or slates, windows broken by debris carried on the storm, dislodged aerials that have gone on to cause further damage and trees or branches brought down by high winds, as well as flooding.

“We have been able to warn our customers of approaching damaging weather, offering advice on how to prepare for the worst as well as providing links and telephone numbers for further information.”

Claimants have been authorised to take immediate emergency action to make their homes safe, if necessary, up to the value of ?1,000.

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“This has been appreciated by customers who in many cases have been able to prevent further costly damage, for example by ingress of rain water.”

On the number of flood rescues and flood car insurance claims, Mr Douglas said: “I’m concerned that so many drivers are reported to have ignored warnings not to drive down flooded roads, even attempting to drive through deep water covering a closed road.

“Many of those our Special Operations patrols – who have been working flat out over the Christmas period – have rescued have been 4x4 drivers under the misapprehension that their vehicle can cope with anything.

“They discover the hard way that ‘off road’ capability doesn’t include flood water.”

Mr Douglas points out that water will destroy a car engine if it is ingested through the air intake.

This can happen if the water is deep or if the driver attempts to drive through shallow water at speed, creating a ‘bow wave’ that floods the engine.

“Our own statistics show that nearly three-quarters (70%) of cars stranded in flood water are written-off,” he says.

Mr Douglas points out that if an insurer is aware that a driver had ignored warnings not to drive through flood water, it is unlikely to meet the cost of a claim.

Other weather related claims taken by the AA Insurance claims team included a roof-box torn off a passing vehicle hitting the customer’s car, causing extensive damage but fortunately no injury.

“Another driver claimed for significant damage caused by a circular trampoline that had been picked up from a nearby garden by the wind and setting it rolling along the road. Most claims are routine for severe weather, however; and include falling branches, tiles and other debris – while some cars are blown off the road.”

Despite the spike in home insurance claims towards the end of the year, 2013 is proving to be one of the least costly for insurers since the widespread floods of 2007.

According to the Association of British Insurers (ABI), the total number of home claims is expected to be around 5% down compared with 2012.

Mr Douglas says that home insurance premiums have been dropping over the past year* and the fall in the number and value of home insurance claims is likely to encourage that trend to continue.

“Although thousands of homes and businesses have been damaged by flood water during the December storms, the scale of devastation is no-where near as great as 2007, which cost insurers ?3.3bn.

“There’s no doubt that investment in flood defences has helped and I hope that the recent weather will encourage the government to continue to boost its programme coastal and inland flood alleviation measures.”

Similarly, the number of car insurance claims has not significantly increased although there is a greater percentage of the total that are for weather-related damage.

“There are a lot of claims for flood damaged cars but not sufficient to halt the current downward trend* in car premiums,” he said.