Home insurance does cover flood. But if you live in a high risk area, the insurance premium will be expensive.
news:
Insurance seen to rocket for flood-risk householdsThere are planning rules to regulate the usage of a building. This one has such term attached, hence the price. You think they won't come around to check? They definitely will. In the rule they have even specified you cant dodge it by sleeping in the boat or motor vehicle(car, caravan, bus...).
Personally I wouldn't bother to waste time to see the estate agent if looking for a house for regular use.