Floods may cost £1.5bn and drive up insurance premiums

By David Millward
As Britain continued mopping up after some of the worst floods in living memory the insurance industry yesterday predicted the cost of the devastation could reach £1.5billion. Although flood warnings remained in force, weather forecasters were not expecting further heavy rain. But there will be showers of hail, sleet and snow over the next few days. The floods, which claimed five lives, forced thousands of people to leave their homes in the Midlands and East Anglia, where particularly severe damage at Kidlington, Oxon, Peterborough, Cambs and Leamington Spa, Warwicks. While the loss of life did not approach that of February 1953, when at least 280 people drowned, last weeks heavy rainfall was described as approaching monsoon levels by the Environment Agency.

Last night the Agency was "cautiously optimistic" that the worst dangers had passed, with the swollen River Ouse and River Nene starting to decrease. But a spokesman warned: River levels will remain high for the next 48 hours and it will take some days to get back to normality. Estimates of the bill faced by insurers vary between ?500 million and ?1.5 billion, beating the ?1.2 billion paid out in the aftermath of the hurricane in 1987.

One assessor predicted a sharp rise in premiums as companies tried to recoup their losses.
Jeffrey Salmon, of Salmon Assessors, insurance claim negotiators, said: "This will affect all sorts of insurance – cars, buildings, contents – and we believe that within nine months premiums will probably go up by a maximum of about 35 percent in order for insurers to recoup their losses quickly". Some of the bill will be met by the taxpayer through the Bellwin Scheme, under which councils are reimbursed by Whitehall for the cost of emergency relief.
Officials are already preparing a report for John Prescott, Deputy Prime Minister, on how much the central Government will pay. However, the heavy rain could be good news for gardeners, according to Water UK, which represents the water companies. A spokesman said the greatest benefit would be felt in East Anglia, one of the driest parts of the country.

Some parts of the region were drenched by a month’s worth of rain in a week. The downpours arrived two weeks after the drought order in Essex and Suffolk was rescinded. Whether the rains will allow the lifting of the other two still in place - at Southern Water and Sutton and East Surrey Water – remained unclear yesterday. Much depends on whether the water drains off or percolates into the soil. But the Environment Agency was optimistic about the overall impact of the rain. "Reservoirs are no problem at the moment, most were almost at full capacity before the floods. There will be some further beneficial effect, but how much is difficult to say", a spokesman said.
The Environment Agency was criticised by Dr. Evan Harris, the Liberal Democrat MP for Oxford West and Abingdon, who claimed it had failed to give his constituents in Kidlington sufficient warning of floods. "I hope compensation will be steered towards these people," he said. "I think there is a strong case for it". Kidlington residents claimed they suffered a flash flood because sluice gates were opened at Banbury, nearly 24 miles away. About 150 people were forced to leave their homes after the River Cherwell burst its banks.

David Charles, 30 of Cherwell Avenue, Kidlington, said: "I saw on the news at 6.30pm on Friday that a village up the road, Thrupp, had flooding and about two minutes later a fire engine came screaming past the house.
"I first saw a little trickle come from the left of our house and when I look around I saw a fairly large gush of water coming between two houses."They met in the middle at the end of our driveway. The water gushed into our back gardens and then came round the front". But British Waterways, which opened the sluice gates to relieve pressure on water-logged Banbury, maintained that the town was too far away for the decision to have had any impact on Kidlington. In Cambridgeshire, soldiers were stood down after being called in to support emergency services helping residents in Peterborough, where parts of the town were under two feet of water after the River Nene burst its banks.
Elsewhere in the country, sandbags were laid in St. Ives and Huntingdon. Although minor roads remained closed, water levels were starting to recede and some people began returning to their homes.

Mopping up also continued in the Midlands and Bedford where, again, water levels were receding swiftly after the River Ouse burst its banks. The heavy rain was described as "grist to the mill of living in north-west Europe" by the National Meteorological Centre at Bracknell, Berks. "Every 15 or 20 years you get some really heavy rain as spring turns into summer. It’s because the atmosphere is warming up, but it is still cold up top so you get instability.
"It’s very similar to what we had in 1983. Land temperatures have been increasing and the atmosphere is bouncing up from the surface forming bigger clouds, which results in storms.