Flood Re closes in 2039 by statute, and the date does not move if flood risk has not fallen
Flood Re was created by the Water Act 2014 and will cease to operate in 2039. That end date is statutory, not conditional. It does not extend if flood risk is higher than expected, if defences are behind schedule, or if the market is not ready. On the day the scheme closes, home insurance for flood-prone property returns to risk-reflective pricing.
That is the entire policy question, and it is worth stating plainly because the scheme is often described as though it were permanent. It is a twenty-three year bridge, and thirteen of those years have gone.
What the scheme does now, and what it will stop doing
Flood Re is a reinsurance arrangement. An insurer writes an ordinary home insurance policy, then cedes the flood element to Flood Re at a fixed price set by the property’s council tax band rather than by its actual risk.
| Council tax band | Buildings | Contents | Combined |
|---|---|---|---|
| A and B | £147 | £58 | £205 |
| C | £175 | £77 | £252 |
| D | £198 | £86 | £284 |
| E | £235 | £117 | £352 |
| F | £346 | £195 | £541 |
| G | £447 | £273 | £720 |
| H | £1,077 | £536 | £1,613 |
Flood Re ceded premium rates from 1 April 2026. A fixed excess of £250 applies to each flood claim on a ceded policy.
Eligibility is narrow and fixed: the property must have been built before 1 January 2009, sit in council tax bands A to H, be held in an individual name, and be a single home or in a building of up to three flats. In 2024/25 the scheme reinsured 347,000 properties, a rise of 20% in a year.
After 2039 none of that exists. There is no council tax band price, no £250 capped excess, and no obligation on any insurer to quote.
What the transition is measured against
Flood Re is required by statute to publish a Transition Plan every five years setting out how it will manage the market’s move to risk-reflective pricing. The plan measures progress in three areas: reducing flood risk itself, reducing the damage a flood causes, and ensuring the insurance market works.
Progress on the first is going the wrong way. The Environment Agency’s national flood risk assessment, the page for which was updated on 5 August 2026, sets out the direction.
| Source | Properties at risk now | Projected by mid-century | Change |
|---|---|---|---|
| Rivers and the sea | 2.4 million | 3.1 million | up 27% |
| Surface water | 4.6 million | 6.1 million | up 31% |
| Any source | 6.3 million | around 8 million | 1 in 4 English properties |
Within the present-day figures, 367,900 properties are at high risk from rivers and the sea and 1,071,800 are at high risk from surface water.
The second measure is where the scheme is putting its effort
If risk itself cannot be cut fast enough, the alternative is cutting what a flood costs when it happens. That is property flood resilience: measures that either keep water out or let a property dry out and be reoccupied quickly.
Flood Re’s own instrument here is Build Back Better, which funds up to £10,000 of resilience measures on top of a repair after a flood. Twelve providers representing more than 70% of the residential market now offer it. Roughly one third of households offered it accept.
The scale problem is set out in FloodReady, the action plan published by the Environment Agency and Defra on 16 October 2025 and chaired by Professor Peter Bonfield. It records the property flood resilience market at around £20 million to £25 million a year, which it characterises as small. Against 6.3 million properties at risk and average flood claims running between roughly £60,000 and £90,000 depending on the event, a market of that size is not going to change the arithmetic by 2039 on its current trajectory.
FloodReady also confirms the destination without ambiguity: the Flood Re scheme is scheduled to end in 2039, after which insurance becomes fully risk reflective. Its central proposal is a Flood Performance Certificate, a property-level measure of flood resilience analogous to an EPC, with a prototype intended for piloting by 2026.
What this means for insurability
Three groups are already outside the scheme and are a preview of the post-2039 market: homes built on or after 1 January 2009, most buy to let, and blocks of more than three flats. They buy flood cover at prices insurers set themselves.
For everyone else the question is what a risk-reflective premium looks like in 2039. FloodReady gives the only clean comparison available. Households with a recent flood claim pay roughly £950 to £1,200 a year through Flood Re today. Before the scheme existed, 60% of that same group would have paid an average of £4,400 a year, and 40% could not obtain cover at all.
Those 2016 figures are not a forecast for 2039. They are what the market charged the last time it priced this risk without a subsidy, at a point when 6.3 million properties had not yet been identified as at risk.
The counterweight
The case for calm is that 2039 is thirteen years away and the scheme was always meant to end. Defences continue to be built, the resilience standard is being formalised, and a Flood Performance Certificate would let a homeowner demonstrate that their property is no longer the risk the flood map says it is. A house with a certified resilience standard is a different underwriting proposition from one without, and that is precisely the mechanism intended to make risk-reflective pricing survivable.
The case against is that the date is fixed and the risk is rising faster than the mitigation. Flood Re’s own assessment of transition progress describes the indicators as pulling in different directions rather than converging.
Frequently asked questions
Can the 2039 date be extended? Not without new legislation. The scheme was established under the Water Act 2014 to operate until 2039, and the end date is statutory rather than conditional on flood risk falling.
What happens to my premium the day Flood Re closes? Your insurer prices the flood element itself. There is no council tax band price and no £250 capped flood excess.
Which properties are already outside the scheme? Homes built on or after 1 January 2009, most buy to let, housing association and company-owned property, and blocks of more than three flats.
What is a Flood Performance Certificate? A proposed property-level measure of flood resilience, similar in concept to an EPC, proposed by FloodReady with a prototype intended for piloting by 2026.
Updated on 11 September 2026.
Sources
- Flood Re, about the scheme
- Flood Re, how premiums are set for ceded policies, rates from 1 April 2026
- Flood Re, eligibility criteria
- Flood Re, transition, annual report and accounts 2024-25
- Environment Agency and Defra, FloodReady, 16 October 2025
- Environment Agency, national assessment of flood and coastal erosion risk in England 2024
- Water Act 2014
- Flood Re, Build Back Better
This article sets out how the scheme and the transition work. It is not insurance or financial advice.
