Flood Re (Flood Reinsurance Scheme), a pooled insurance system which mean that even the most at-risk homes will have access to insurance, is set to launch in 2015.
It is estimated that between 300,000 and 500,000 households which are at risk of flooding would find it difficult to obtain flood insurance, according the Association of British Insurers (ABI).
In contrast to previous plans, properties which fall within the most expensive council tax bands are set to be included within the scope of Flood Re.
The top band in England and Scotland is H, while Wales introduced band I for its most expensive properties in 2005.
Flood Re chief executive Brendan McCafferty said that he was very pleased that a workable and sensible agreement had been reached.
“Flood Re is of huge importance to hundreds of thousands of householders at risk of flooding and this agreement allows us to progress beyond the design phase so that Flood Re can become a reality,” he said.
Under the new scheme, if insurance companies feel they are unable to insure a home against flooding, they will pass on this risk to Flood Re.
This comes with a fixed premium for a household, which will be calculated at set rates based on its council tax band.
ABI chairman Paul Evans added: “A year on from the floods that had such a devastating impact on home owners across the country, this is a great result that will ensure continued access to affordable insurance for all who were previously covered by our voluntary statement of principles.”
There is no set date for the delivery of the project at this time, but it is expected to be active within the second half of 2015, backed by an investment by insurers of £17 million.
Lexelle offers a range of added value products, including Home Emergency Solutions, to provide enhanced levels of cover for existing personal lines clients: