Insurance Curator 
Flood insurance in the UK can feel overwhelming if you live in a high-risk area. After severe storms and widespread flooding, many homeowners have faced soaring quotes or outright refusals from insurers. This is where Flood Re steps in as the quiet safety net behind some of the most affordable flood cover available today.
The scheme has been running since 2016, and it has transformed the way UK home insurers approach properties that sit in high-risk flood zones. We’ll explain exactly how Flood Re works, who qualifies, what you’ll pay, which properties are left out, and how to secure a policy that gives you genuine peace of mind.
What Is Flood Re and Why Does It Exist?
Flood Re is a UK-wide reinsurance scheme, created by the Water Act 2014 and launched on 4 April 2016. It exists for one simple reason: to make flood insurance available and affordable for homes that would otherwise struggle to obtain cover because of their location. It is not an insurer, and you never buy a policy from Flood Re directly. Instead, it stands behind insurance companies, absorbing the costliest part of the flood risk.
To understand the problem it solves, you only need to look back at the flooding events of 2000, 2007 and 2015. Thousands of households near rivers and on flood plains were being quoted premiums of thousands of pounds, or denied cover altogether. Before Flood Re, the insurance industry’s voluntary “Statement of Principles” had promised cover for high-risk homes, but that agreement was due to expire, and no workable replacement existed.
Flood Re’s Role in Plain English
Flood Re is a reinsurer, which means it insures the insurers. When you buy a home insurance policy covering flood risk, your insurer can hand that flood risk over to Flood Re, in exchange for a fixed, predictable reinsurance premium. If your home then floods, Flood Re pays your insurer, and your insurer pays you.
What matters most to you is that Flood Re caps the flood-risk part of your premium. Instead of paying a premium that reflects the true, often extreme, cost of insuring a flood-prone home, you benefit from a price based on your property’s council tax band. The gap between that capped price and the real cost of claims is funded collectively by the insurance industry through an annual levy.
- Flood Re is not a government body, though it works under a framework set by the UK Government.
- It is funded by the insurance industry, through an annual levy of around £180 million.
- It is time-limited, designed to operate until 31 March 2039.
- It allows most eligible homeowners to buy flood cover from their own insurer or through a broker, exactly as they would any other policy.
For those looking to understand the mechanics, Flood Re is best thought of as a pooling system. The whole of the UK’s home insurance market contributes to a shared fund, and that fund pays for the worst flood losses, so that no single household is left carrying the full weight of their postcode.
How Flood Re Works: The Journey of a Flood Re-Backed Policy
The clearest way to understand how Flood Re works is to follow a single policy from quote to claim. Every step is designed to feel invisible to you, the policyholder, so that you receive the same service you would from any standard home insurer.
Step One: You Request a Quote
You contact a participating insurer or a specialist broker, either online, by phone, or through a comparison site. You provide your normal details, including the age of your home, its rebuild value, and its council tax band.
Step Two: The Insurer Checks Eligibility
If your property is in a flood-prone area, your insurer will assess whether it qualifies for Flood Re. The eligibility rules are laid down by the regulations behind the scheme, and your insurer will check them automatically. Qualifying homes are typically residential properties built before 1 January 2009, within council tax bands A to H in England and Scotland, or A to I in Wales.
Step Three: The Insurer Cedes the Flood Risk
Once eligible, the insurer can choose to hand the flood element of your policy to Flood Re. In exchange, the insurer pays Flood Re a fixed reinsurance premium, which is determined by the property’s council tax band. This is the crucial cap that keeps your premium down.
Step Four: You Receive a Full Policy
The insurer then quotes you a total premium for the whole policy. That total combines the capped flood element with the normal premium for other risks, such as fire, theft, subsidence and escape of water from burst pipes. You pay the insurer, and the insurer pays Flood Re behind the scenes.
Step Five: You Make a Flood Claim
If your home floods, you report the claim to your insurer in the usual way, and you should expect the same claims service you would receive on any policy. Your insurer assesses the damage, arranges repairs or payments, and then recovers the flood-related costs from Flood Re under the reinsurance arrangement.
This is where the scheme reassures many worried homeowners: you never deal with Flood Re, you never wait longer for a payout, and you never need to explain your property’s history twice. The policy you hold remains a standard buildings and contents insurance policy, issued and regulated in exactly the same way as any other UK home insurance.
The Levy and the Government Backstop
Flood Re is funded by a levy placed on all UK home insurers, with each insurer’s contribution based on its share of the home insurance market. That levy currently raises around £180 million a year, which is used alongside the fixed reinsurance premiums paid by ceding insurers.
In an exceptionally catastrophic flood year, Flood Re also has access to a government-backed borrowing facility of up to £2.5 billion. This arrangement means the scheme can always pay out, even after an event on the scale of the 2007 summer floods, without collapsing or passing the entire bill to policyholders in the following year.
Flood Re Premium Caps and Policy Limits
The most quoted part of how Flood Re works is the premium cap. This is the maximum amount that can be charged for the flood-risk element of your insurance, and it is based entirely on your property’s council tax band. It does not cap the total premium for your whole buildings and contents policy.
Council Tax Band Premium Caps
| Council Tax Band (England & Scotland) | Maximum Flood Element Premium Cap |
|---|---|
| A – B | £210 |
| C – D | £260 |
| E – F | £340 |
| G – H | £420 |
In Wales, the same caps apply to bands A to H, with band I treated at the highest cap level. These figures are reviewed periodically, but they have remained unchanged since the scheme’s launch, which gives homeowners a useful degree of predictability.
Let’s use a realistic example. A semi-detached home in a Band D property, sitting close to a river in an Environment Agency flood zone, might previously have been quoted £1,200 solely for the flood part of the policy. Under Flood Re, the flood element cannot exceed £260. If the rest of the policy, covering theft, weather damage, subsidence and escape of water, is priced at £180, your total premium would be around £440, a dramatic saving compared with the old open-market quote.
Sub-Limits for Buildings and Contents
Flood Re does place a cap on the amount it will contribute toward any single ceded policy. The scheme covers buildings up to a £250,000 rebuild cost and contents up to £50,000. If your rebuild cost is higher, the insurer can still provide the additional cover, but the amount recoverable from Flood Re will stop at the sub-limit.
For the vast majority of UK homes, these limits are more than sufficient. The average rebuild cost for a typical three-bedroom house is far below £250,000, and a £50,000 contents limit comfortably covers a standard household’s belongings. For high-value or unusual homes, you should discuss the arrangement with your broker to understand how the sub-limits interact with your full sum insured.
The Compulsory Flood Excess
Flood Re also sets a compulsory excess for flooding claims, which applies in addition to any voluntary excess you choose. This excess has been structured by council tax band and changed in April 2022.
| Council Tax Band | Compulsory Flood Excess per Claim |
|---|---|
| A – D | £250 |
| E – H | £500 |
This is an important budgeting consideration. If your home is in a higher council tax band and suffers flood damage, you must contribute £500 before the insurer’s payment begins. We always recommend reviewing your household budget to ensure you could manage this excess if the worst were to happen.
Who Qualifies for Flood Re-Backed Insurance?
Flood Re eligibility is set in law, and the criteria are strict. Knowing whether you qualify before you start shopping around will save you time and frustration. You can quickly check the basics yourself before contacting an insurer.
The Core Eligibility Criteria
- The property must be residential, such as a house, bungalow, flat, maisonette or similar dwelling.
- It must have been built on or before 1 January 2009.
- It must be in council tax bands A to H in England or Scotland, or A to I in Wales.
- The policyholder must be an individual person, not a company or corporate entity.
- The property must be used as a home, either by you, your family, or a tenant.
Flood Re is also available for properties let to tenants, provided the landlord is an individual and the tenancy is an assured shorthold tenancy or similar residential arrangement. This has been a lifeline for landlords who own homes in flood-prone areas and previously faced ruinous commercial premiums.
Properties That Do Not Qualify
- Homes built after 1 January 2009 do not qualify, because modern building regulations require new properties to meet higher flood-resilience standards.
- Commercial premises, including shops, offices, warehouses and mixed-use buildings, are excluded.
- Companies, limited liability partnerships, and public bodies cannot use Flood Re, regardless of the property type.
- Holiday lets and second homes are not eligible where they are run as a commercial business or let out as holiday accommodation.
- Purpose-built student accommodation and other specialist housing arrangements fall outside the scheme.
Some property types require a closer look. A leasehold flat occupied by an individual leaseholder is generally eligible. A flat owned by a private landlord with a normal tenancy agreement is also eligible, as long as all other criteria are met. The best test is whether the property is someone’s home, rather than a purely commercial asset.
Flood Re Myths vs Facts
Over the years, several misconceptions have built up around how Flood Re works. Many of these stem from people confusing Flood Re with flood defence spending, or assuming it is a Government-funded payout scheme. Let’s separate the myths from the facts.
| Myth | Fact |
|---|---|
| Flood Re is a Government fund that hands out grants. | Flood Re is funded by the insurance industry through an annual levy. The Government created the legal framework but does not pay claims. |
| I can buy a Flood Re policy directly from the scheme. | You cannot buy from Flood Re. You must purchase a policy from a participating insurer or broker. |
| Flood Re will protect my home from flooding. | Flood Re is insurance, not flood defence. It pays for damage after flooding; it cannot stop water entering your home. |
| Only homes that have already flooded can use Flood Re. | Any eligible home in a flood-risk area can benefit, even if it has never flooded before. |
| Flood Re covers storm damage and burst pipes. | Flood Re covers the flood peril only, defined as water from rivers, seas, estuaries, surface water or groundwater. Burst pipes fall under escape of water. |
| My insurer and Flood Re share my private information. | Flood Re is a data processor under strict data rules, and insurers only pass the information needed to run the scheme. |
| Once Flood Re ends, I will never get flood insurance again. | The scheme exists until 2039, and is designed to transition gradually so that prices move toward a sustainable market level. |
One point worth repeating is that Flood Re does not guarantee you a quote. An insurer can still decline to offer you a policy, although in practice the scheme has made cover widely available. The Financial Conduct Authority (FCA) has reported that the majority of high-risk homeowners can now obtain at least one quote, and specialist brokers often secure cover from multiple providers.
Flood Re and “Build Back Better”: Rewarding Flood Resilience
Flood Re has expanded beyond simple premium capping. Through its Build Back Better initiative, the scheme encourages homeowners to repair their homes more resiliently after a flood, so that future floods cause less damage. This is a genuine step forward for UK flood insurance, because it reduces the emotional and financial cost of repeat flooding.
What Build Back Better Offers
When you make a flood claim under an eligible policy, your insurer can now include an allowance for flood-resilience repairs as part of the settlement. Flood Re’s scheme provides up to £10,000 towards improvements that go beyond like-for-like repairs. These might include:
- Self-closing flood doors and water-resistant windows
- Air brick covers and non-return valves on drains
- Raised electrical sockets, boilers and wiring
- Replacement of wooden floors with waterproof tiling
- Water-resistant plaster and wall finishes
- Improved drainage and landscaping measures around the property
These measures must be installed by certified professionals and must be cost-effective when compared with the expected reduction in future flood damage. The practical benefit is that your home recovers faster, you restore your life sooner, and you reduce the likelihood of having to claim again.
The 35% Premium Discount
From early 2023, Flood Re’s offering grew even stronger. Insurers using the full Build Back Better framework are now permitted to offer a discount of up to 35% on the flood element of your future premium, provided the resilience measures have been installed and verified.
That discount can be significant. For a Band E home, where the flood element cap sits at £340, a 35% reduction would save around £119 per year. Since the resilience improvements often come from money you are already receiving through a claim settlement, you are in effect future-proofing your home at little or no additional out-of-pocket cost.
For those looking at properties in high-risk areas who have not yet claimed, it is worth asking your insurer whether any of these resilience measures might be covered before a flood event. Some insurers are beginning to include resilience discounts at inception, rather than only after a claim, so it pays to ask.
How to Find and Buy Flood Re-Backed Cover
Securing flood insurance through Flood Re is simpler than many homeowners fear, but it does require a slightly different approach than renewing a standard policy on a comparison site. The key is to know where to look and how to present your details.
Step-by-Step Guide to Getting Covered
-
Check eligibility before you shop. Confirm your property’s build date, council tax band, and ownership structure. If you are unsure of the build date, your local authority’s records or your title documents can help.
-
Start with your existing insurer. If you already have home insurance, contact your provider and ask whether your flood risk is being ceded to Flood Re. Many major UK insurers automatically use the scheme for eligible properties.
-
Use an independent specialist broker. The British Insurance Brokers’ Association (BIBA) runs a “Find a Broker” service that helps consumers locate experts in flood insurance. Specialist brokers have direct access to insurers who actively use Flood Re for high-risk properties.
-
Try comparison sites, but be thorough. Not every comparison site passes on the right flood-risk information. Provide accurate details about your flood history, your flood defences, and your property’s construction. If a quote looks unreasonably high, call the insurer directly.
-
Compare the flood element separately. It can be difficult to compare whole policies when one includes Flood Re and another does not. Ask each insurer to show you the breakdown between the flood element and the rest of the premium.
-
Read the excess terms carefully. Remember the compulsory Flood Re excess of £250 or £500. If an insurer adds a large voluntary excess on top, the policy may become unworkable for you.
-
Review your sum insured each year. Because Flood Re covers buildings up to £250,000, make sure your rebuild cost is accurate. An underinsured property can lead to a reduced settlement after a flood, so ask your broker or use a rebuild-cost calculator.
Where You Might See Flood Re on Your Documents
Many policyholders are surprised to learn that their insurer does not always tell them that Flood Re sits behind their policy. Flood Re now requires insurers to make the arrangement transparent, so you may see it mentioned in your renewal statement, your policy booklet, or your insurer’s website.
If your insurer has ceded your flood risk to Flood Re, you should also receive information about what the scheme does and how to complain if things go wrong. Despite that, your contract remains with the insurer, and all normal consumer protections under the FCA’s rules continue to apply.
The Future of Flood Re: Transition to a Fairer Market
Flood Re was never designed to exist forever. The legislation that created the scheme gave it a lifetime until 31 March 2039. In the years leading up to that date, Flood Re is required to help the UK insurance market transition back to a state where normal competition can price flood risk fairly and affordably.
The 2030 Transition Plan
Flood Re’s transitional strategy, developed in consultation with the Government, the Association of British Insurers (ABI), the Environment Agency and other stakeholders, sets out a path toward risk-reflective pricing. Between 2026 and 2030, the fixed premium caps are expected to be phased out gradually, replaced by a single premium path that moves prices toward the true cost of flood risk.
This sounds concerning, but the transition has been designed to protect consumers. The expectation is that, by the early 2030s, significant investment in flood defences, clearer property-level resilience data, and better building standards will keep risk-reflective prices affordable. Flood Re’s data sharing with the Environment Agency and local authorities is already improving the accuracy of flood modelling.
What the End of Flood Re Means in Practice
- Premiums will gradually reflect the real risk of flood at each individual property.
- Homes with good flood resilience measures will enjoy lower premiums than those without.
- Government flood investment will play a larger role in keeping high-risk homes insurable.
- Insurers will have greater freedom to price, but also greater responsibility to be fair and transparent.
The 2039 sunset clause shines a light on something every high-risk homeowner should act on now: property-level flood resilience is becoming the single most important factor in your long-term insurability. Every pound spent on flood doors, non-return valves or raised electrics is likely to pay for itself many times over in future premiums.
Frequently Asked Questions About Flood Re
Do all UK insurers take part in Flood Re?
Not all, but the great majority of mainstream home insurers participate. The annual levy is paid by all firms that sell home insurance in the UK, but individual insurers choose whether to actually cede your flood risk to Flood Re. If one insurer refuses to use the scheme for your property, a specialist broker will almost certainly find another that does.
Does Flood Re cover surface water flooding?
Yes. Flood Re covers flooding caused by rivers, seas, estuaries, surface water and groundwater, as long as it meets the standard definition of flood in your insurance policy. In recent years, surface water flooding has become the most common type of flood event in the UK, so this cover is particularly valuable for urban and suburban homeowners.
Is Flood Re the same as claiming from the Government?
No. Flood Re is a private, industry-owned reinsurance scheme, regulated by the Prudential Regulation Authority and the Financial Conduct Authority. It receives no general taxation funding, although it has a government-backed loan facility for catastrophic events. Your claim is paid by your insurer, and your insurer recovers from Flood Re.
What happens to my policy if my property is sold?
Flood Re cover is attached to the property and the policyholder, not to the land itself. If you sell your home, the new owner will need to arrange their own insurance. If the property still meets Flood Re’s eligibility criteria, the new owner may also benefit from the scheme, provided they are an individual rather than a company.
Can I increase my voluntary excess to lower my premium?
You can, but you should remember that the compulsory Flood Re excess of £250 or £500 will be applied first. A very high voluntary excess might reduce your premium, but it could leave you facing a total contribution of £1,000 or more in the event of a flood. We generally recommend keeping the flood excess as low as possible.
Does Flood Re apply to Northern Ireland?
Flood Re was designed primarily for policyholders in England, Scotland and Wales. Northern Ireland is not included in the scheme because of its separate legislative framework. Homeowners in Northern Ireland should speak to specialist brokers about alternative high-risk flood cover arrangements.
Will my no-claims discount be affected by a flood claim?
Most insurers will treat a flood claim like any other claim, meaning one claim could affect your no-claims discount. You cannot build a no-claims record with Flood Re itself. Some insurers now offer “flood-protected no-claims bonuses” or similar options, so ask your provider about how a flood claim would affect your renewal.
Is Flood Re compulsory for insurers?
No insurer is forced to cede a specific risk to Flood Re. However, the scheme is structured so that participating insurers can offer competitive prices to high-risk homes, which creates a strong commercial incentive to use it. If an insurer chooses not to use Flood Re, they rarely publicise that, so it is worth asking directly.
What if my home has flooded many times before?
Previous flood claims do not exclude you from Flood Re, provided your property meets the basic eligibility criteria. In fact, the scheme was designed precisely for homes with a history of repeated flooding. Your insurer will record your claims history, but the flood element of your premium remains capped according to your council tax band.
Are landlords and tenants covered?
Tenants can buy contents insurance through Flood Re, provided the property itself meets the eligibility rules. Landlords who are individuals can buy buildings insurance, and often contents cover, for let properties. Corporate landlords are excluded and must approach the commercial insurance market.
Final Thoughts: Protecting Your Home and Your Peace of Mind
The UK’s flood insurance market can feel like a complex maze of exclusions, excesses and postcode penalties. Flood Re was created precisely to cut through that complexity, giving homeowners in high-risk areas a fair, affordable route to the cover they need. Understanding how Flood Re works is no longer an optional extra; it is an essential part of responsible homeownership for anyone living on a flood plain, near a river, or in an area with surface water risk.
Our advice is straightforward: find out whether you are eligible, use the scheme to secure proper buildings and contents insurance, and invest in property-level resilience now. The earlier peace of mind you purchase is not just a policy document, but a guarantee that your greatest asset will not become an uninsured liability.
Flood Re has already helped more than half a million UK households obtain cover that would otherwise be unaffordable or unavailable. By taking action today, checking your options, and speaking to a specialist broker, you place yourself firmly in that protected group. The system is on your side; all you need to do is make sure it works for you.