Does you car insurance cover flood damage?

According to the Association of British Insurers, there have been up to £25 million motor insurance claims made this year as Britain saw the wettest summer in a hundred years. Not only have homes been damaged beyond repair but thousands of motorists have been left high and dry by insurance companies who are desperate to survive the vast payouts. Research by the online price comparison and switching website uswitch.com reveals that motor insurance premiums could go up to 57% if a claim is made on a flood damaged car. Worryingly, only 75% of all motorists in these flood-risk areas are even covered for such an eventuality.

If you have third party fire and theft insurance you are not covered for flood damage. However some motorists that are fully comprehensively insured might not be covered either in incidences when flooding occurs to the extent it did this summer. The insurance companies often look for loopholes.

One such loophole involves action taken by motorists during and after the flooding. If a motorist tries to restart their car after it has been flooded and then causes an electrical fault to occur, they might exempt themselves from cover. Also, if the motorist drives the car through flooded areas, where water can become sucked through the exhaust pipe to flood the engine, this too can invalidate motorists from cover.

It’s a two-way argument. Motorists should research their cover, read the small print if they live in areas at risk of flooding and then check if they are adequately covered. Equally, insurance companies should notify their customers about what they are covered for. Direct Line, Churchill, More Than, esure, Norwich Union Direct, Saga and Switchcover are all non-specific in terms of their cover for flood damage.

Another problem is possibly losing a no claims discount when making a claim after flood damage, even though it could be argued as an ‘Act of God’. There could also be an excess to pay too when submitting a claim, but again this is all dependent on the extent of the damage and the individual policy. The estimated payout total for all insurance companies, both motor and home, is set to reach a massive £2.5 billion from this year’s flooding.

Gocompare.com have estimated that over a quarter of UK drivers might not be covered in the event of flooding, but after this summer’s biblical flooding, what is now classed as a flood-risk area and what is not? The Head of Insurance at uswitch.com Aron Thompson said, “Too many motorists are playing a risky game by failing to secure adequate cover should the worst happen”.

Of course, it would make sense to always be fully comprehensively insured but often this is too expensive for motorists. Overall tips would be to avoid tampering or driving cars that have already been affected by flood damage, have a detailed knowledge of what you are covered for, and remain in communication with your insurers at all times.

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