Question to the Department for Environment, Food and Rural Affairs:

To ask the Secretary of State for Environment, Food and Rural Affairs, whether she can disclose how much additional risk the Flood Re scheme is underwriting this year than it was when it launched; and whether she holds any information about the sustainability of those trendlines through to 2039.

In its first operational year (2016/17), the Flood Re scheme’s Liability Limit was £2.1 billion and 127,326 policies were ceded to the scheme. By 2024/25, 346,200 policies were ceded and from 1 April 2025, the Liability Limit reset to £3.2 billion for three years, with annual Consumer Price Index adjustments thereafter.

The Liability Limit is set for successive three-year periods and reviewed ongoingly by the Scheme Administrator, Flood Re Ltd, to ensure alignment with the Flood Reinsurance (Scheme and Scheme Administrator Designation) Regulations 2015. Flood Re Ltd monitors risk exposure and sustainability as part of its statutory obligations. Its future trajectory, including sustainability through to 2039, is based on ceding forecasts, their risk levels and a prudent margin for uncertainty.

Flood Re must also publish a Transition Plan every five years, outlining how it will move towards a market with affordable flood insurance without the need for the scheme after 2039.