28.This Part contains new arrangements designed to deal with the affordability and availability of home insurance in areas of high flood risk. The framework includes:
powers to establish a levy-funded reinsurance pool for high risk households (known as “Flood Re”), and
reserve powers to regulate the insurance industry by requiring insurers to each insure a certain share of a list of higher flood risk properties (known as the “Flood Insurance Obligation”).
29.The reserve powers are needed in case Flood Re proves unworkable or does not deliver the Government’s policy goals, and if pricing in an open market proves to be unacceptable.