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Think tank: We have Energy Performance Certificates, why not for flood?

Think tank: We have Energy Performance Certificates, why not for flood? | Insurance Business

Think tank: We have Energy Performance Certificates, why not for flood?

British think tank Social Market Foundation (SMF) has an idea to help address flood risk. Think Energy Performance Certificates but, yes, in the context of flooding. 

In a report sponsored by Flood Re, the SMF proposed the introduction of flood certificates to show information such as when the property was last flooded, the depth and nature of flooding, surveyor-recommended mitigation measures, and an assessment of recommendations take-up.  

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“To increase the resilience of the UK’s housing stock, more needs to be done to support households to protect themselves,” said SMF senior researcher Matthew Oakley. “Making flood readiness a visible part of a property’s value would allow those who invest in flood precautions to realise a financial gain for that work – and encourage those who have not prepared to start doing so.”

He noted that with flooding being a major issue in the UK, “too little” is being done by owners to protect their properties from flooding risks and costs. “This needs to change,” stated the former senior civil servant.

According to the SMF’s report Incentivising Household Action on Flooding, if the information suggested to be part of flood certificates is made available to prospective investors, property owners “would no longer be incentivised to avoid resistance or resilience measures” and instead would find themselves facing a potential boost to their properties’ capital value.

If implemented, the flood certificates would apply to homeowners either selling or letting their properties.   

“We’re also calling for the government to introduce a more generous and ambitious grant scheme for those affected and for action from the insurance industry and Flood Re to help households make the right decisions,” added Oakley. “By doing so, the next time a major flood event hits the UK, households across the UK will be better placed to respond.”

 
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