UK Building Homes Uninsurable Due to Future Flood Risk, Warns Aviva CEO

Thousands of new homes being built in England could become uninsurable in the future due to increasing flood risks, according to Amanda Blanc, the CEO of insurance giant Aviva. Blanc stated that based on current construction patterns, approximately 115,000 new homes are projected to be built in flood zones over the next decade.

"That doesn't seem to me to make sense. We need to think about where those homes are being built," Blanc told the BBC.

According to the Environment Agency, about 6.3 million homes and businesses in England are already at risk of flooding. Aviva's research indicates that one in nine homes constructed between 2022 and 2024 are at medium to high risk of flooding. Blanc expressed concern that England is "for sure" building homes that may not be insurable at some point.

"It's very well known where these flooding areas are. Let's think very carefully about homes that are being built," she urged.

Blanc also highlighted the need for a different approach to construction bordering flood zones, noting that properties can be modified to become more or less vulnerable to flood damage.

Aviva's research further suggests that by 2050, nearly a third of new homes built in 2024 will face some level of flood risk, with one in seven potentially at medium to high risk as extreme weather events become more frequent.

The Met Office has previously estimated that record-breaking wet winters, such as the one experienced in the UK in 2023-2024, have shifted from occurring once every 80 years to once every 20 years due to current global warming levels.

Blanc also commented on Aviva's readiness to invest in infrastructure, noting the company's existing investments exceeding £100 billion in the UK, with £35 billion allocated to infrastructure projects like hospitals, schools, and wind farms. She emphasized the desire to invest in UK infrastructure for good returns for pension holders, but stressed the need for clear details to facilitate such investments.

Regarding the state pension triple lock, which links annual increases to the highest of average wage growth, inflation, or 2.5%, Blanc stated it was not her place to dictate government policy. However, she noted that any potential reduction in state pension increases due to changes in the triple lock could necessitate higher private pension provisions to maintain the balance.

The BBC has approached the government for comment on these matters.