This research followed a mixed-method approach with quantitative and qualitative data that could provide a broader view of the situation of SMEs. On the one hand, to fulfil objective (I) an online survey was developed targeting affected businesses in flooded regions across UK. The unit of analysis were small and medium sized enterprises (SMEs), understood as that type of organisation that employs up to 250 employees. We made a distinction within this category to provide more granularity in the results to acknowledge the different resources that micro firms have over medium ones. The objective of this project is to improve our understanding of flood insurance for SMEs, and to establish if SMEs have flood insurance problems, and if so, how they could be overcome and which other risk management strategies could be available for SMEs. CCCEPII: Can ‘Flood Re’ increase the resilience of small businesses? Investigating flood insurance and other risk management strategies According to the latest UK Climate Change Risk Assessment, flooding is the main future climate risk. Around 1.1 million of non-residential properties are at risk from all types of flooding. Flooding is rarely good business, and for small and medium enterprises (SMEs) it is sometimes a matter of survival. They can destroy the assets of a company, but they may also bring disruptions in the supply of raw materials or of public services, modify the demand of products, diminish worker productivity, just to mention some hidden impacts. Financial protection against flood risk has been recognised a way to protect assets and livelihoods. However, concerns exist about the affordability of cover in high risk areas. Those concerns led to the creation of Flood Re, a scheme were premiums are subsidised. Flood Re has been considered by some as a retrograde action, as it covers all homes, including high income households, but excludes micro-businesses, small businesses, charities and cooperatives in high-risk flood areas. The argument was that flood insurance is widely available for SMEs, and brokers can help SMEs secure flood cover. The Federation of Small Businesses casts doubts about if the insurance market will work for SMEs in the face of increasing impacts. The Government and the industry have recognised that finding affordable insurance can be a challenge for a few SMEs, at an aggregate level, they are confident that this is not a widespread issue. Nevertheless, it has been noted that “should significant evidence emerge of a systemic market failure in these sectors, the Government and the ABI have agreed to discuss the way forward”.

Survey. The data was collected between March and August 2018, and are businesses from different parts of the country. We acknowledge that the quantitative results do not represent a statistically significant sample of the whole country. Qualitative interviews provided a deeper understanding of the issues that SMEs are facing across the country, specifically the barriers and opportunities of insurance as a risk management strategy and other innovative strategies, which is the sub-objective (II) of this research. In this sense, the qualitative data comprise 38 semi-structured interviews carried out mainly over the phone.