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James Moore: A flood of problems as the rain pours down

Outlook For years now, the insurance industry has been playing poker with the Government over covering householders against flood damage.

Whenever rivers burst their banks, a new hand starts with insurers initially threatening to withdraw cover from properties where flooding is not so much a risk as a certainty, only to fold when the final "river" card is dealt.

With the cost of the recent deluge quite likely to top the £400m paid out during the summer, it is going to be an expensive year. This may be the last time insurers will pay up. Withdrawing cover from people at serious risk of flooding looks like a contemptible act from a pretty contemptible industry. And there will be a high public relations price to pay.

It is because of this that insurers may again decide to continue to offer cover by cross-subsidising it from the premiums of those of us only minimally at risk.

However, floods don't tend to be covered as part of home insurance policies elsewhere in Europe, and industry appeals for Government action to beef up flood defences and stop developers building on flood plains have been met with a tin ear. Spending has been falling on the former and one can only imagine the effect of plans to tear up planning rules on the latter. If the industry is behaving badly, it is hardly alone.