RECORD insurance-premium increases face millions of householders around the country after last week’s floods and heavy rainfall.

This is the insurers’ knee-jerk reaction to the floods and gales that hit many parts of the UK last week and are forecast to trigger a rush of claims. The government is also coming under fire for not spending enough on flood defences.

Ironically, this is the weekend when the general insurance industry comes under the supervision of the Financial Services Authority for the first time, and should be striving to offer customers the fairest possible deal.

The extreme weather conditions claimed at least 10 lives and damaged thousands of homes. Climatologists predict further storms will hit over the next few weeks, causing concern for the estimated 5m people living in areas at high risk of flooding.

But insurance pundits warn that the price of repairs will spread far beyond those in flood-risk areas.

Richard Mason of the Insuresupermarket.com comparison website said: “It is inevitable that the cost of paying out on flood claims will push premiums up for all homeowners.”

Home insurers increased premiums in 2002 and 2003 when they realised that the cost of flood-related claims was climbing higher.

John Hollis of More Than, an insurer, said: “We increased home-policy premiums by between 10% and 12% across the board in late 2002 and 2003 so that the cost to customers reflected our increased costs. The same thing was happening across the industry as insurers realised that the cost of paying flood and storm-damage claims was on the rise.”

Some in the industry claim last week’s storms alone are not enough to push up the price of home insurance in general.

Malcolm Tarling of the Association of British Insurers said: “A single event will not push up premiums across the board, as insurers factor in the risk of freak weather damage during the winter months when pricing policies.”

However, the cost to insurers will be considerable. Halifax General Insurance received 10 times the usual number of claims-related calls last weekend, forcing it to more than double the number of staff in its call centres.

And even the industry’s apologists are unable to rule out premium hikes should further flooding occur.

Tarling said: “While we don’t expect premiums to have to rise across the board, there is no guarantee that they won’t be affected if there are more instances of extreme weather causing damage to properties.”