U.K.'s Flood Re opens for business with A- financial ratingPosted On: Apr. 4, 2016 12:00 AM CST
Flood Re Ltd., the government-backed household insurance plan for homes in flood risk areas of the United Kingdom, was launched Monday and assigned an A- financial strength rating by Standard & Poor's Corp.
Flood Re enables participating insurers to pass on the flood risk element of homeowners policies.
Flood Re is funded by a levy of £180 million ($256.1 million) a year on U.K. household insurers.
The size of the levy will be reviewed after five years.
The London-based reinsurer is backed by the U.K, government and also has a £2.1 billion ($2.99 billion), three-year retrocessional program backed by international reinsurers.
I am delighted to announce that Flood Re is now live and ready to accept policies,” CEO Brendan McCafferty said Monday in a statement.
“This should make flood cover more affordable and accessible to those in high flood risk areas over time,” he added.
S&P said its A- rating of Flood Re reflected it opinion “of Flood Re's satisfactory business risk profile and strong financial risk profile.”