A leading industry research body has called on insurers to work more closely with the government to reduce flood risks.
Benfield Greig Hazard Research Centre made the call in its annual report: "Flood Risk & Insurance in England & Wales: are there lessons to be learned from Scotland?" The report comes as thousands of homes and businesses in England prepare to face increased flood disasters.
Report author Professor David Crichton said: "Weather records for rainfall and temperature are being broken regularly, and yet we are still building in flood hazard areas, often against the advice of the Environment Agency.
"This has been made possible by the market distortions caused by the insurance guarantee, which has until now enabled buyers of properties in flood risk areas to obtain mortgages and insurance."
The report warned that the development of floodplains in recent years has left millions of households exposed to flood risks. About 27% of new property in England is built on floodplains.
According to the report, under investment in drainage infrastructure has left many urban centres susceptible to flooding. Crichton called for English authorities to copy the approach of Scottish councils, which has led to new insurance arrangements.
"While the new insurance arrangements will cause serious problems for many people in the short term, in the long term it may lead to a more sustainable approach if insurers can work closely with local planning authorities in England and Wales in the same way as they do in Scotland," the rerport said.
