Sir Michael Pitt’s review is expected to urge insurers to speed up rehousing and to fund advertising and research on flood risk.

See also: Flooding Question Time

The ABI was braced for a row this week as it awaited the publication of the Pitt review into flood management on Wednesday.

The report, scheduled for publication after Insurance Times went to press, is expected to tell insurers to speed up the rehousing of flood victims and to help fund several costly initiatives.

Ahead of publication of the report, which is expected to be scathing in its criticism of the insurance industry, an ABI spokesman defended the industry over its handling of claims related to the floods of last summer.

He said: “We dealt with over 17,000 displaced customers and we estimate that around 96% of those are back in their homes. That leaves about 2,000 and our members are working round the clock. We refute any inference that insurers could do more.”

It is the second time since May that the ABI has had to defend itself over the 2007 floods.

Last month, floods recovery minister John Healey accused insurers of failing to do enough to rehouse flood victims, which sparked an angry response from Nick Starling, the ABI’s director of general insurance.

The ABI insists its members have handled the claims process as best they can, especially considering there were over 55,000 properties affected.

“We dealt with more claims in June and July [2007] than in the previous four years put together, so you’ve got to put it into perspective,” the spokesman said.

The Pitt review is expected to contain proposals for a radical new type of insurance policy that would cover entire communities in flood-risk areas. It is also expected to suggest that the government and the industry share the costs of an advertising campaign that shows the importance of insurance.

Another proposal expected was that insurers could fund research to find ways of drying out flooded homes faster.

But the ABI spokesman said: “It’s not for the ABI to fund that type of research. It’s something more for the building industry.”

Ministers commissioned the Pitt review – Learning Lessons from the 2007 Floods – from Sir Michael Pitt last year. In interim reports, Pitt has said the whole country must be better prepared for future floods.

His recommendations are expected to carry weight with the government, which is negotiating with the insurance industry over the level of public funding for flood defences and the provision of flood cover for at-risk homes.