Homeowners are "in denial" about the risk of flooding, the Environment Agency (EA) has warned.
According to the EA, the cost of cleaning up a property after a flood is 30 times the expense of being burgled. Yet fewer than one in three homeowners has identified the risk.
The EA is stepping up its publicity campaign to make homeowners aware of the risk as the ABI called on government to increase flood defence spending to £750m by 2011.
It said government was "failing" on it spending plans.
"Spending on flood defences is now falling in real terms. We believe that flood defence spending needs to rise by 10% a year to £750m by 2011. This will give those vulnerable to flooding the protection they need, and the flood insurance cover they depend on," said Jane Milne, the ABI's head of property.
The EA estimates that up to £1bn is spent on cleaning up the aftermath of flooding - a figure, which it says, will rise if the public remains apathetic to the issue.