Two year deadline for government to provide adequate flood protection

"The losses from last year were substantial, the storms and floods together cost us in the order of �20m over and above what we normally would have expected," explained Malcolm Cooper, home insurance manager at Direct Line.

"However, we do not intend increasing rates as a result of that. We want to hold prices as they are."

Better information may lead to some insurers hiking premiums for those in affected areas, and further incidents of bad weather could see significant premium increases in the future.

The Association of British Insurers has already given the government an ultimatum - either it erects adequate flood defences or it will start refusing to cover entire areas of the country that are at risk, a policy known as "redlining".

Datamonitor's report concludes nearly half of all weather related claims last year were from storm damage. Underwriting losses rose to �700m last year from �230 million in 1999, no profits have been made for nearly five years and none are likely for a couple more years yet.

Passing the buck

It is predicted most insurers will past some of these increased costs to customers.

"Premiums we believe are likely to rise approximately 3.5% over the last year," says Simon Ronaldson, lead insurance analyst at Datamonitor.

"As the weather damage claims in the latter part of 2000 were so extreme a significant proportion of the increase is probably due to those claims."

There is no conclusion either way on whether last years floods and storms are likely to be a regular occurrence as a permanent effect of global warming or if it was just cyclical weather patterns.

Either way, when insurance premiums rise, it is very rare they ever drop again.