03Transition

The Government in England has not published statistics on the number of properties built on the flood plain since 2022. The last updated set of statistics, for 2021-22, show that in England 7% of new residential addresses were in Flood Zone 3, which is described as “the Environment Agency’s best estimate of the areas of land at risk of flooding, when the presence of flood defences are ignored and covers land with a 1 in 100 (1%) or greater chance of flooding each year from Rivers; or with a 1 in 200 (0.5%) or greater chance of flooding each year from the Sea.” If these rates continue as housebuilding increases, this will represent a large increase in the number of homes at flood risk.

Schedule 3 of the Flood & Water Management Act 2010 was due to be implemented by December 2024 but has been delayed and now may not be implemented at all[1][2]. This would have required sustainable urban drainage systems as part of new developments, with local arrangements to ensure these were appropriate and included a commitments to have these maintained and then adopted by risk management authorities. Equivalent arrangements are already in place for Wales.

The UK Government’s Planning and Infrastructure Bill has not strengthened flood protections in the planning process, while the updated National Planning Policy Framework references SUDS, but without implementing the stronger mandatory requirements of Schedule 3. The National Infrastructure Commission has recommended the Government update planning guidance to “require planning authorities to ensure that from 2026 all new development is resilient to flooding from rivers with an annual likelihood of 0.5 per cent for its lifetime and does not increase risk elsewhere”. No action has been taken to implement this recommendation.

[1] 27 November 2023 – Public Accounts Committee – Oral evidence session – Committees – UK Parliament

[2] Planning and Infrastructure Bill (Twelfth sitting) – Hansard – UK Parliament

2024 was the hottest year ever recorded and the first year to exceed the 1.5⁰C warming threshold, with the global average temperate 1.6⁰C above pre-industrial levels. Atmospheric CO2 concentrations reached a new peak after the fastest rise on record between 2023 and 2024 and are projected to continue to rise in 2025, albeit a smaller increase due to natural sinks. Emissions globally are currently trending above both the RCP 2.6 pathway (which would mean achievement of the Paris Climate Change Agreement to limit global warming to 1.5⁰C) and the RCP 4.5 (which would mean missing them – currently most closely aligned to this path). There is still time to implement policies to avert the worst implications of climate change. But limiting warming to even 2°C at this stage will require rapid, deep and in most cases immediate greenhouse emission reductions which are not being seen globally. Global temperature rises above 1.5⁰C would make it significantly more difficult – and expensive – for the UK to adapt to global warming.

The third National Adaptation Programme was published in July of 2023, representing the Government’s overarching national adaptation strategy, this is updated every five years. The assessment of the Office for Environmental Protection in its 2025 annual progress report continued its 2024 assessment that plans on both adaptation and mitigation continue to show limited progress and remain largely off track (red rating), while the Climate Change Committee’s 2025 Progress in adapting to climate change report to Parliament found that “The Government has yet to change the UK’s inadequate approach to tackling climate risks”.

Flood Re’s Build Back Better initiative went live in 2023/24 with insurers joining the initiative at various points since. This will significantly increase the demand for flood resilience products in the UK. The Environment Agency’s (EA) second PFR framework remains in force, providing the framework through which both the EA and local authorities procure PFR for homes. After nearly 3 years in which no new products received certification to the British Standard, one company had three of its products certified, assisted through a Knowledge Transfer Partnership with a local university, providing a minor positive for the product innovation and certification ecosystem. There were no significant company entrances or exits from the market. Overall, no significant changes were observed – costs remained high and the industry has yet to be mainstreamed. The Environment Agency commissioned the FloodProof review led by Professor Peter Bonfield to provide recommendations to help mainstream PFR, with the review expected to report in autumn 2025. The International PFR Association (IPFRA) was formed, creating a strategic industry voice. These major initiatives are opportunities to make considerable progress in this area in the future.

In last year’s indicators, Flood Re highlighted the implementation of Build Back Better (BBB) and the EA’s new PFR framework (as above) as causes for optimism. Both of these programs remain in place, but are not leading to the increases in resilience that had been envisaged. For BBB, this is because of the good fortune of relatively low-levels of flooding, but also because take-up of BBB by householders remains at around 1/3^rd of those offered. The EA’s PFR framework has significantly expanded the envelope of funding available for PFR, but as of yet there is no evidence that this and record levels of flood defence spending overall, has led to increased installation of PFR. There is no central program for supporting property resilience in Wales, Northern Ireland or Scotland, though in Scotland we are aware of several local authorities attempting to establish PFR programs.

The UK Government has commissioned Prof Peter Bonfield to undertake a review of Property Flood Resilience in the UK. Flood Re hopes this will improve the utilisation of PFR within England’s flood resilience program.

Flood Re has undertaken a number of initiatives during 2024/25 to raise awareness of flood risk and how it can be mitigated this includes the  Flood Resilient Garden which was presented at Chelsea Flower Show. The garden explained how householders could use their garden to reduce their flood risk, and the publicity generated reached millions of people. Awareness initiatives targeted particular geographical areas, including the January 2025 launch of ‘Flo’ the flood bus in conjunction with the Scottish Flood Forum. This will tour flood affected communities demonstrating how householders can improve their resilience to flooding.

As of March 2024, 1.58M properties were registered to receive the environment Agency’s free flood alerts (see S17 report section 6.2.2), which was 40,000 more than the previous year (but a slower pace of increase, as 110,000 had signed up in the previous year). Despite this, no major new indications of flood awareness have emerged, since the previous year when a survey for the ‘Be Flood Smart’ campaign found just 24% of respondents at ‘high’ flood risk correctly identifying their risk. More action is needed, by both public bodies and the insurance sector to inform householders about their risk.

The cost of reinstating a home after flooding is dependent on the costs of material, labour and alternative accommodation. In 2024, rebuild costs showed a second consecutive year of levelled-off growth in the 2% range (2.3% in the year to Q1-2025)  after the 20% rise in 2022.

Cost rises (including rebuild costs and alternative/rental accommodation costs, with the latter having seen considerable rises in recent years) saw more than a 50% increase in Flood Re’s average cost of a claim between Storms Ciara and Denis in 2021 and Storm Babet in 2023. That cost has remained stubbornly high – the average cost of home insurance flood claims in 2024 and 2025 has ranged between about £60,000 and £90,000, depending on the event.

Analysis undertaken by Flood Re and Verisk last year estimated that UK insurers will pay out £2bn to repair flooded homes in the UK over the subsequent five years. This was further supplemented with research released in January 2025 in conjunction with Fathom and addresscloud showing that average annual damages to residential properties by flooding of £640M. This – and the rising premium costs noted in the next bucket – show insurers and householders need to be doing more to contain costs.

The UK remains a world-leader in flood modelling, in both the public and private sector. In 2024/25, the Environment Agency published the long-awaited updated National assessment of flood and coastal erosion risk . This represents significant progress in the granularity and detail of the publicly available information, and for the first time provides integrated surface water and fluvial risk, future flood risk due to climate, and flood depths – and it significantly updated the numbers of those at risk of flooding, to 6.3M properties from 5.2M/5.7M under the previous version. Flood Re is not aware of plans to publish equivalent detail in Scotland, Wales or Northern Ireland.

While flood maps are able to identify flood risk at an increasingly granular level, Flood Re remains concerned as to how effectively the maps are capturing the flood resilience features, particularly those at community level (including surface water alleviation) and household level. A failure to capture resilience features reduces private incentives to invest in resilience measures, as there is no corresponding increase in access to financial services. Flood Re is undertaking a programme of work alongside industry and academic partners to establish the methodology and standards for recording, scoring, and communicating resilience features.

Flood Re continues to ensure the widespread availability and affordability of insurance: 98% of flood risk sample were able to get 15+ quotes from price comparison websites, and 99% of those with recent flood claims were able to get 5+ quotes. Inflation in the insurance market levelled off in 24/25, after a rise of nearly 40% in quoted prices during 2023/24.  Flood Re’s tracking of flood risk properties shows proportionate price increases for flood risk properties.

The number of properties ceded to Flood Re increased significantly in 2024/25, with the number of properties reinsured through the Scheme rising by 20% to 347,000. This follows single-digit increases in ceding in previous years. This suggests growing reliance on the Scheme.

The biggest development in 2024-25 in the consumer information space is the publication of National assessment of flood and coastal erosion risk 2024 (also noted in indicator 8 above). This has provided significantly more information at household level. For the first time householders can access an integrated flood risk indication (combining surface water and fluvial risk), and be given an indication of likely flood depth.

A Flood Re commissioned survey of UK householders found that 80% of households have insurance – 95% of owner-occupiers, and 53% of renters. The last major poll of the topic (2021) found that 91% of owner-occupiers, and 56% of renters, had insurance. Although Flood Re’s survey indicated that a small proportion (3-5%) had stopped obtaining insurance in recent years, overall figures for penetration remain broadly similar despite the considerable increase in prices observed between 2022 and 2024. There has been an observed move in the market to essentials products, but given flood cover is included as standard this still represents a market with significant coverage levels across the UK.

The number of insurers offering Build Back Better (BBB) has remained strong and growing, with 12 major insurance providers onboard who account for over 70% of the UK’s residential property insurance market.

Global trends in reinsurance markets have continued to be a concern. Whilst natural catastrophe reinsurance pricing is now starting to soften again, following recent years of significant increases due to inflation and the growing increase in climate related disasters, Flood Re’s reinsurance costs have risen by more than £100m per annum as at 1st April 2025 compared to the previous reinsurance programme which was last purchased 3 years ago at the 1st April 2022. But were Flood Re not in existence, the tightening reinsurance market would have added pressure directly to insurers offering flood cover in the UK. As a result, household insurance prices have been partially insulated from costs that continue to rise for climate disasters globally, but this has come at a cost of heavier reliance on and exposures for the Flood Re scheme, as the increased ceding numbers in indicator nine demonstrate.

Crucially and positively, there is still no evidence of insurers seeking to unbundle cover to remove flood protection, as has been seen in other countries. Our work this year has included a report looking at other schemes globally, seeking to understand those that have held up under pressure and ensure sustainability of the UK insurance market over the longer term.