The ABI has published a series of recommendations designed to slash the estimated £55m increase in the insurance industry's annual flood bill.
The bill is expected to arise from government plans to build 200,000 homes in the South East. The ABI estimates that proper planning could reduce the flood risk to minimal levels in all areas, except the Thames Gateway where the risk could be halved.
One-third of the new developments will be located in flood plains leading to a 74% increase in the annual cost of flooding in the targeted areas - Ashford (Kent), the M11 corridor, the South Midlands and the Thames Gateway.
ABI director of insurance Nick Starling said: "Working together, government, local authorities, developers and insurers can ensure that truly sustainable communities are achieved."