The insurance disaster which threatened many riverside communities and homeowners across Northumberland, who have seen their properties ruined by repeated flooding, looks to have been averted.
A scheme has been agreed which will allow insurers to continue to cover at-risk homes.
Flood Re is a not-for-profit solution which is intended to be up and running by summer 2015.
It will be financed by a pool of money that all the insurance companies will pay into. In return, the Government pledges to increase its spending on flood defences.
Ryan Roberts, H&H Insurance Brokers’ Northumberland representative, said: “The agreement has come in the nick of time for the dozens of people in Northumberland who were affected.
“The existing statement of principles expires at the end of July; ourselves along with many anxious customers were almost literally staring into a black, and watery, hole. Now, provided that the details can be worked out, homeowners by watercourses and near floodplains can expect to get affordable insurance cover against their risks.”
The Association of British Insurers and the Government have reached this agreement after a nail-biting period of uncertainty for everybody.
The pool of money created will cover the flood-risk elements of people’s policies – and was always the industry’s preferred solution in the face of rival proposals.
Mr Roberts said: “There have been compromises on both sides and issues do remain to be addressed.
“This is the start of a process and for it to succeed there will have to be unprecedented levels of partnership between the Government and the industry.
“But with Flood Re as the Government’s preference, and a shared vision for the future, there is now a structure in place that will help to address the threat from weather and flooding in the UK.”