Take cover – rising waters!
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Take cover – rising waters! By Emma Horsley None of us have been spared the headline pictures of flood waters devastating homes and livelihoods. Until recently there has been insufficient information available to assess the risk and a mistaken belief that insurance against flooding will always be available. In April 2016 the Law Society updated their Practice Note for Solicitors on advising clients about flood risk and providing information for clients buying in flood prone areas. The issues associated with flooding are significant and likely to affect the value of the property. Solicitors are not qualified to give advice on the risk of flooding or to interpret technical flood reports, however we do have a duty in all cases to consider whether or not to mention the issue of flood risk, and if appropriate, make further investigations. The most important and significant factor for clients is to: 1. Identify any flood risk. The first port of call has to be to ask the Seller. During the course of the conveyancing transaction, the Law Society Property Information Form (TA6) includes a question about flooding and whether the property has been affected. Flood searches are widely available and the Environment Agency offers valuable information on their website about river, coastal and surface water flooding, which is constantly updated with flood warnings. A property does not have to be near a river or the sea to be at risk. Surface water, ground water and overflowing sewers are increasingly common causes of flooding. Flash flooding in June this year swallowed up several cars in south London. Surface water flooding happens when rainwater does not drain away through the normal drainage system but lies on, or flows over, the ground instead.
The Environment Agency has prepared a map to enable anyone to check the risk of flooding from rivers seas, reservoirs, surface water and the information is readily available on the internet as an initial enquiry. 2. Be aware that flood searches are available. Commercial providers can produce good desktop flood searches using robust data, more accurate than the Environment Agency's public site. It is then for the clients and their surveyors to interpret the information available and decide whether further investigation is needed. www.howardkennedy.com If you would like more information on our services, please visit www.howardkennedy.com here you will find all our latest news, publications and events. This material is for general information only and is not intended to provide legal advice. Š Howard Kennedy LLP 2016
3. Encourage clients to establish the availability and cost of buildings insurance early on in the transaction. Buyers should be made aware from the outset that the risk for buildings insurance passes to the buyer upon exchange of contracts, not completion. Insurance companies have been working with the Government to develop a different way of dealing with flood insurance and have introduced a ' flood re-insurance' scheme known as the Flood Re scheme to help support households at the highest flood risk. Flood Re went live and became operational on 4th April 2016 and the Gov.uk website has further information about Flood Re Insurance (Scheme Funding and Administration) Regulations 2015. This only applies to buildings for private residential use and to houses built before the 1 January 2009. Certain categories of properties will be excluded from the scheme, including many leasehold flats, small and medium sized businesses and buy-to-let properties. Flood Re will be in place for 25 years providing affordable, widely available insurance allowing time for Government, local authorities and communities to be better prepared for future flooding events. The Environment Agency estimates that 1 in 6 homes in England are at risk from flooding. There are more homes at risk of surface water flooding than from flooding from rivers or the sea and 1 million homes are at risk from both. There are 200 homes within the UK that are at risk of complete loss to coastal erosion over the next 20 years or so and 2000 more could potentially become at risk over this period. Avoid the sandbags and do your research‌ For more information, please contact:
Penny Joshi Conveyancing Executive T: +44 (0) 20 3755 5536 E: penny.joshi@howardkennedy.com
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If you would like more information on our services, please visit www.howardkennedy.com here you will find all our latest news, publications and events. This material is for general information only and is not intended to provide legal advice. Š Howard Kennedy LLP 2016