Last updated: November 26, 2012 9:53 am

Talks on flood insurance at ‘crisis point’

Homes flooded on Cheats Road in the Somerset village of Ruishton, near Taunton, which has been flooded after the River Tone burst it's banks©PA

Flood talks between the government and insurers have reached “crisis point” the industry association said, as torrential rain in parts of England and Wales left three people dead and forced hundreds from their homes.

Nick Starling, a director at the Association of British Insurers, criticised the government for rejecting an “elegant solution” to the problem of providing affordable cover to homes at high risk of flooding.

“Our members are out there looking after people who have been affected by these tragic floods, and that means we want a solution even more now after the difficult events of the weekend,” he told the BBC’s Today programme.

“They have reached a crisis point. We’ve had two years to sort this out and during that time the insurance industry has put in a massive amount of work and money into coming up with an insurance-led solution, and we seem to have reached an impasse,” he said on Monday.

A 10-year deal between the industry and government is due to expire next year, leaving 200,000 homeowners without flood insurance. The ABI has suggested a not-for profit fund run by insurers with a temporary overdraft facility to be paid back within a year.

Richard Benyon, minister repsonsible for floods, said the government was working hard to protect both the taxpayer and those in areas at risk of flooding. But he refused to discuss the details of the negotiations saying it was a “shame” it has been raised now.

David Cameron, the prime minister, has promised to ensure help for victims as the Environment Agency said on Sunday that more than 800 homes had been flooded and thousands of motorists were rescued from waterlogged roads.

Chris Fawkes, of the BBC Weather Centre, said there had been about 60mm of rain in the previous 24 hours in southwest England.

He said: “A weather front will slowly move across north England and north Wales Sunday night and Monday, and it’s here that we are likely to see some further serious flooding.”

Mr Cameron said on Twitter: “Shocking scenes of flooding in Cornwall and around the country. Government will help ensure everything is being done to help.’’

Devon and Cornwall were badly hit, along with parts of Yorkshire, Warwickshire and Wiltshire.

The Environment Agency said another 71,000 properties were at risk. There were more than 230 flood warnings in place across England, meaning people should take action because flooding was expected.

Those included 125 in the Midlands, 57 in the southwest, 25 in East Anglia and 17 in the northeast. One severe flood warning remained in place for the River Cober in Helston, Cornwall.

The agency said there was a medium risk of flooding on Monday in North Yorkshire, Hartlepool and Middlesbrough.

While many houses have been flooded, some haven’t because of the efforts of these people

- Richard Benyon, environment minister

Emergency services warned drivers not to drive into flood waters after hundreds of vehicles had to be rescued. West Midlands Ambulance Service said there was a high number of call-outs to 4x4 vehicles as people tried to find short-cuts away from flooded roads across country.

Mr Benyon met people in Malmesbury, Wiltshire, where three feet of water were reported in some parts of the town.

He described the clear-up work as “heroic’’, adding: “While many houses have been flooded, some haven’t because of the efforts of these people. The government’s job, first of all, is to make sure people are as prepared as possible with a changing climate . . . for these extremes of weather. Secondly, we’ve got to continue building flood defences.’’

Earlier, he had said that while hundreds of homes had been flooded, the “silver lining” was that more than 24,000 had been protected by newly built flood defences.

Many roads were closed because of flooding, particularly in the southwest. Network Rail said trains between Exeter and Bristol were likely to be suspended until Monday.

Police in Devon put up barriers for crowd control after scores of people came out to watch as the embankment of the Grand Western Canal collapsed.

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