Nicola Garbarino, Benjamin Guin and Jonathan Lee

5.2 million properties in England are at risk of flooding. To ensure the availability and affordability of flood insurance to households in flood-prone areas, the UK Government introduced an innovative reinsurance scheme, Flood Re, in April 2016. It provides insurers with an option to pass the flood-risk element of their policies on to the reinsurer at a lower fixed price according to property council tax band. In a recently published Staff Working Paper, we employ a granular data set of all property transactions and flood events in England. We estimate the effect of Flood Re on property values. We also explore if Flood Re effects are heterogeneous across different subpopulations in England.

Continue reading “The effects of subsidised flood insurance on real estate markets” →