ABI Predicts £1bn Losses from Flood Claims

The Association of British Insurers has given a bleak assessment of claims resulting from recent flooding, doubling RMS' estimate yesterday with a prediction of £1bn in liabilities. In a statement issued today, the ABI said insurers are working round the clock to assist customers who have been flooded. The ABI estimates that 27,000 homes and 5,000 businesses have been affected by the recent floods and storms and that the cost of claims is expected to reach £1bn. "This figure could rise if more properties are affected by further flooding", it said.

Stephen Haddrill, director general, said "Insurers are working as hard as possible to reach customers and to visit properties early. But these events are so widespread that insurers are redeploying staff to affected areas, increasing staffing levels in call centres and undertaking visits to community centres. However, even emergency procedures cannot deliver our normal standards of service. We are doing all we can to help families, elderly customers and those with health difficulties first. We hope that other people can bear with us as we work through the backlog. We will reach everyone as soon as we can.

"We are keeping the Government informed of the situation and requesting meetings with the relevant members of the new Cabinet."

Insurance companies have put into place their crisis action plans, are re-deploying staff from around the country and are bringing in additional equipment from abroad. Extra staff are contacting customers by phone wherever possible and visiting community centres to identify customers who have been evacuated.

Vulnerable customers - the elderly, families and those with health problems - are being prioritised. Clean up operations are underway where flood waters have receded. However, the scale of the problem is enormous and despite putting in place streamlined measures, the industry's normal response times will not be possible in all cases.