James Moore: Insurance industry set for a soaking in flood misery

Outlook We might be in the middle of a drought (at least according to water companies which don't like the idea of splashing out to fix leaky pipes) but it seems that floods are on their way.

This means another round of big losses for the insurance industry, which coughed up £3bn in 2007, not to mention agony for householders as they try to pick up the pieces when the waters have receded.

Given the way the industry conducts business, particularly when customers have cause to claim on their policies, it is hardly a surprise that few people feel much sympathy for it when it complains. But on the issue of floods it has a right to feel hard done by.

The last government gave developers carte blanche to throw up houses on flood plains, while doing little to improve flood defences. The current administration appears close to doing the same thing by the way it is reforming planning regulations.

The Chartered Insurance Institute (CII) says it doesn't have to be like this. Yesterday it published a paper by one of its members showing that where industry and government are willing to co-operate and come up with sustainable flood-management plans, such as in Scotland, insurance losses (not to mention householder agony) can be minimised, if not eliminated.

The CII doesn't just criticise government south of the border for failing here. It says that in Scotland, the Association of British Insurers helped to fund the creation of flood-liaison groups involving industry representatives and local politicians which did much to tackle the problem. By contrast, the insurance industry's biggest trade body seems to have preferred bellyaching south of the border.

With both sides sitting on their hands, flood misery and insurance losses are here to stay. Given the storm that would be created if insurers withdrew flood cover in England, the paper predicts they will simply raise premiums in places where the issue has been tackled (Wales and Northern Ireland as well as Scotland) to subsidise cover where it hasn't (England).

The English have long complained (with some justification) that their taxes are used to subsidise more generous public services in the Celtic hinterlands. It looks like some of that money is going to come pouring back.

Suggested Topics
Start your day with The Independent, sign up for daily news emails
ebooks
ebooksA special investigation by Andy McSmith
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Claims Administrator

£16000 - £18000 per annum: Recruitment Genius: A position has arisen within th...

Ashdown Group: Development Manager - Rickmansworth - £55k +15% bonus

£50000 - £63000 per annum + excellent benefits : Ashdown Group: IT Manager / D...

Recruitment Genius: Security Officer

£16500 per annum: Recruitment Genius: Applicants must hold a valid SIA Door Su...

Ashdown Group: Business Analyst - City, London

£50000 per annum: Ashdown Group: Business Analyst - Financial Services - The C...

Day In a Page

The saffron censorship that governs India: Why national pride and religious sentiment trump freedom of expression

The saffron censorship that governs India

Zareer Masani reveals why national pride and religious sentiment trump freedom of expression
Prince Charles' 'black spider' letters to be published 'within weeks'

Prince Charles' 'black spider' letters to be published 'within weeks'

Supreme Court rules Dominic Grieve's ministerial veto was invalid
Distressed Zayn Malik fans are cutting themselves - how did fandom get so dark?

How did fandom get so dark?

Grief over Zayn Malik's exit from One Direction seemed amusing until stories of mass 'cutting' emerged. Experts tell Gillian Orr the distress is real, and the girls need support
The galaxy collisions that shed light on unseen parallel Universe

The cosmic collisions that have shed light on unseen parallel Universe

Dark matter study gives scientists insight into mystery of space
The Swedes are adding a gender-neutral pronoun to their dictionary

Swedes introduce gender-neutral pronoun

Why, asks Simon Usborne, must English still struggle awkwardly with the likes of 's/he' and 'they'?
Disney's mega money-making formula: 'Human' remakes of cartoon classics are part of a lucrative, long-term creative plan

Disney's mega money-making formula

'Human' remakes of cartoon classics are part of a lucrative, long-term creative plan
Lobster has gone mainstream with supermarket bargains for £10 or less - but is it any good?

Lobster has gone mainstream

Anthea Gerrie, raised on meaty specimens from the waters around Maine, reveals how to cook up an affordable feast
Easter 2015: 14 best decorations

14 best Easter decorations

Get into the Easter spirit with our pick of accessories, ornaments and tableware
Paul Scholes column: Gareth Bale would be a perfect fit at Manchester United and could turn them into serious title contenders next season

Paul Scholes column

Gareth Bale would be a perfect fit at Manchester United and could turn them into serious title contenders next season
Inside the Kansas greenhouses where Monsanto is 'playing God' with the future of the planet

The future of GM

The greenhouses where Monsanto 'plays God' with the future of the planet
Britain's mild winters could be numbered: why global warming is leaving UK chillier

Britain's mild winters could be numbered

Gulf Stream is slowing down faster than ever, scientists say
Government gives £250,000 to Independent appeal

Government gives £250,000 to Independent appeal

Donation brings total raised by Homeless Veterans campaign to at least £1.25m
Oh dear, the most borrowed book at Bank of England library doesn't inspire confidence

The most borrowed book at Bank of England library? Oh dear

The book's fifth edition is used for Edexcel exams
Cowslips vs honeysuckle: The hunt for the UK’s favourite wildflower

Cowslips vs honeysuckle

It's the hunt for UK’s favourite wildflower
Child abuse scandal: Did a botched blackmail attempt by South African intelligence help Cyril Smith escape justice?

Did a botched blackmail attempt help Cyril Smith escape justice?

A fresh twist reveals the Liberal MP was targeted by the notorious South African intelligence agency Boss