Spending Review: AA warns homes could become "uninsurable"

AA insurance has backed the government’s spending review decision to protect homes at risk of flooding but is concerned current spending levels will not be maintained.

In the review released today the government committed to spending £2bn on flood defences over the next four years between 2011 and 2015. This compares with £2.15bn over three years, between 2008 and 2011, in the previous review.

Simon Douglas, director of AA, said there is no doubt Britain’s climate is changing and that there is “a likelihood of future inundations similar to Tewkesbury and Cockermouth.”

He said there are also an increasing numbers of claims for flash flood damage in areas with no previous risk of flooding, which he said suggested spending on draining water at a local level is inadequate and local severe weather events are increasing in frequency and severity.

“It is vital that the insurance industry and the government work together to tackle the growing risk of flooding especially as the Statement of Principle on flood insurance, between the Association of British Insurers and the Government, comes to an end in 2013,” said Douglas.

He added: “My greatest fear is that inadequate spending on defence against very real and growing risk will affect home insurance premiums for everyone and could leave thousands of homes uninsurable and thus un-mortgageable in the future.”