As the world heats up, the likelihood of flooding grows. The related risks are existential for some low-lying coastal areas and island states, such as the Cayman Islands.

In the UK, 6 million homes are at risk of flooding – just over half from the sea and rivers, and the rest from surface water. But the Government is providing flood protection for 40% fewer properties than planned and it recently ditched 25% of its 2,000 flood protection schemes.

Plans for tens of thousands of new homes in flood risk areas have been approved, almost 110,000 properties built over the past decade sit in flood zones, and a growing proportion of the UK’s flood defences are in disrepair.

A Public Accounts Committee inquiry into flood resilience, released in January, calls the Government’s approach "contradictory and self-defeating".

This lack of preparedness coincides with a 170% rise in flood warnings to nearly 1,600 in 2023.

Since October the UK has endured four named storms - Babet, Ciaran, Debi and Henk - that together led to more than £500 million in home damage claims. Average flood claim costs had already shot up 53% in the year before Babet. Since 2023, home insurance premiums for previously flooded homes or ones that lie near water have risen nearly 30%.

A deputy governor of the Bank of England says that in the absence of climate action, things could get worse: "In areas particularly at risk of flooding, many homes could become uninsurable."

For insurers, flood risk is ‘uninsurable’ if it defies the principle that the premiums of the many pay for the losses of the few. Covering such risks is uneconomic, as evidenced by the destabilising exodus of firms from the insurance market in a growing number of US states.

Tackling flood risk in itself requires increased public investment in surge protection and flood resilience, including through natural flood management. But keeping temperatures from rising in the first place is also critical, and this is where the insurance sector comes in (again).

As Insure Our Future points out, "our best insurance is to keep fossil fuels in the ground", but "most insurers continue to underwrite the expansion of the oil and gas industry".

Among them is home insurance provider Lloyd’s – ‘the world’s biggest marketplace for fossil fuel insurance’. In a recent open letter, the coalition urges the International Association of Insurance Supervisors to "steer the industry away from exacerbating climate risk".

In the US state of Connecticut, lawmakers have gone one step further with a bill that, if passed into law, would impose fees on insurers for backing fossil fuel projects. Could this be a sign of a shift towards climate regulation of the insurance sector?