Julian Knight: Flood warning: how long will insurers step into the breach?

A year ago this month, Hull, a city of more than a quarter of a million people, was hit by a flood of almost biblical proportions. The rain fell at an astonishing rate – 18 Olympic-sized swimming pools every second – and when it finally stopped, 17,000 homes and 92 schools were damaged, many beyond repair. Thousands of Hull families are still putting their lives back together, with little help from the rest of the country.

And, so it seems, with little help from the insurance industry, which talked a good game at first but has since alienated people in the city. Many in the area feel that some firms are quibbling over every penny and unnecessarily delaying the work required to get householders back in their properties.

As the British summer gets off (yet again) to a very damp start, more families around the UK may be worrying that they could share the fate of the people of Hull. So what is being done? The Environment Agency says it has been busy learning the lessons of last summer's floods, which affected large parts of the UK. Let's hope it is true to its word as the waters have just risen in the South-west.

Fortunately, the insurance industry has been honouring its promise so far to continue to insure homes in areas deemed at risk of flooding. But the question has to be asked: how long will this commitment last? Insurers I speak to are getting increasingly twitchy about the paucity of government spending on flood defences and measures to stop river estuary flooding.

Around £800m a year is earmarked for defences until 2011, but as flood events seem to get more dramatic and expensive, this doesn't look anywhere near enough money. Another summer of paying out on expensive claims could tempt some firms to break ranks and announce an end date to their commitment.

The trouble is, the Government can't throw money at the problem because after years of profligate spending, it simply doesn't have any left. Let's just hope for a dry summer then.

Come off it, Barclays

Barclays has become the second big UK bank, after Alliance & Leicester, to overhaul its overdraft charges. The bank says the changes make its fees transparent and cut the costs of going into the red (Kate Hughes puts these claims to the test on page 15).

But as with most things in banking, the devil is in the detail. Take, for example, Barclays' decision to stop paying interest to most of its current account customers. The bank trotted out a series of excuses for its decision. Among these was that research shows people don't value the interest paid on their current accounts, so it might as well be scrapped. This is the same lame excuse that was given by First Direct – coincidentally backed up by research – when it too stopped paying interest a few months back.

Now you can get research and surveys to say nearly anything you want depending on what you ask.

So let me try my own question on Barclays' customers: "Should your bank be able to use the money you have in your account to earn cash for its shareholders' benefit, and then not give you a penny?" If Barclays' customers had been asked that question, they'd have probably said they care very much what happens to their interest.

And Barclays' excuses didn't stop there. It said that the lost interest was only equivalent to a few pennies a month – which simply underlines that it, like many other high-street banks, has been underpaying its current account customers for years.

But for me, the top prize in the excuses stakes goes to the Barclays spokeswoman who told The Independent on Sunday that stopping paying interest would be of benefit to consumers because it would make filling out a tax return easier. Give me strength.