Aviva chief warns of generation of uninsurable homes as flood-zone building continues

Amanda Blanc, the chief executive of insurance giant Aviva, has warned that England is continuing to build homes in locations where flood risk is rising so sharply that properties constructed today could become impossible to insure in the not-so-distant future. Speaking to the BBC's Big Boss Interview podcast, Blanc said she found the current pattern of development "doesn't make sense" and questioned whether homes should be going up in mapped flood zones at all.

The scale of the warning is significant. Based on prevailing building patterns, roughly 115,000 new homes will be constructed in flood zones over the next decade alone, according to figures cited by Blanc. Her concern is not simply about the homes themselves but about the mismatch between where the country is building and where the risk is increasing. Flooding risk, she said, is "absolutely increasing", and it is well understood where the danger lies.

Official estimates underline the backdrop to her comments. The Environment Agency reckons about 6.3 million homes and businesses in England are already at risk of flooding. Aviva's own research adds a more recent snapshot, finding that one in nine homes built between 2022 and 2024 are at medium to high risk of flooding — a striking proportion for properties only a few years old.

Looking further ahead, Aviva's analysis suggests the picture deteriorates. Nearly a third of new homes built in 2024 are expected to face some level of flood risk by 2050, with one in seven falling into the medium-to-high risk category as extreme weather becomes more acute. The Met Office has separately estimated that, given current levels of global warming, record-breaking wet winters of the kind the UK experienced in 2023-2024 have shifted from being once-in-80-year events to once-in-20-year events — a fourfold increase in frequency that makes historic flood maps a poor guide to future exposure.

Blanc said England was "for sure" building homes that might be uninsurable at some point in the future. She stressed that the locations of flood-prone areas are already known and mapped, which she said should make informed decisions about new construction possible. She also argued that the problem extends beyond homes sited inside flood zones: developments on the boundaries of those zones, she said, need a different approach, because a range of measures — from property-level protections to design choices — can make a building more or less vulnerable.

Insurability, rather than flooding itself, is at the heart of her argument. A home in a high-risk location can lose access to mainstream home insurance, or face premiums that buyers and lenders will not absorb, at which point it becomes difficult to sell, mortgage or simply live in. That would turn a flood-risk problem into a housing-market and financial-stability problem, with insurers, mortgage lenders and future owners all exposed. The BBC has approached the government for comment.

The timing of Blanc's intervention is significant. She used the interview to urge the government to avoid policy "kite flying" ahead of Chancellor John Healey's first Budget, which is scheduled for 28 October. Her concern is that repeated speculation about pension reform has already caused measurable harm, having previously seen withdrawals from her schemes run at around 30 times the normal rate in the space of a year — a surge she said customers may come to regret, since a tax-free lump sum once taken cannot be returned.

The few policy announcements made so far include a scheme designed to help first-time buyers get onto the property ladder and a commitment from Healey to deliver a "new age of industrialisation" for the UK. Blanc's warnings suggest that any drive to accelerate housebuilding will need to be paired with serious attention to where that building takes place, and to the insurance consequences that follow.

Aviva is a major UK private pension provider and one of the country's largest employers, and Blanc said the firm is "ready with capital" to invest in UK infrastructure. She pointed to more than £100bn already invested in the UK, of which £35bn goes into infrastructure ranging from hospitals and schools to windfarms. She said the returns are attractive for pension holders and scheme members, but cautioned that further detail is needed to convert that readiness into actual deployment.

Asked about the ongoing debate over the pension triple lock — the mechanism by which the state pension rises by the highest of average wage growth, inflation or 2.5% — Blanc said it was not for her to dictate policy. She did, however, flag the trade-off: any reduction in annual state pension increases would need to be offset by higher private pension provision, so the balance between the two pillars has to be considered rather than one in isolation.

Taken together, her comments present a coherent caution. Development and infrastructure investment are central to the government's economic agenda, and Aviva is keen to participate. But the insurance industry is effectively signalling that without careful siting, flood resilience and long-term risk planning, some of what is being built now could be assets the market cannot sustain — and homeowners cannot afford.