Insurance company Norwich Union has announced it will increase its premiums by ten per cent.
A spokeswoman for Aviva, the parent company of Norwich Union, insisted the premium review was not linked to the recent floods, which cost the business £340 million.
"There will be an increase in premiums as the flooding is one of the elements causing claim inflation. The increase will on average be ten per cent," she explained.
The firm, which insures 20 per cent of households in the UK, said that second-half results would be harmed by the costs imposed by the calamity. It added that reinsurance expenses involved in preventing damage from similar events in the future would also harm its results.
The spokeswoman for the company told Reuters that other factors such as home improvements had also resulted in the premium increase.
"The industry as a whole has seen pretty flat premiums in household buildings and contents market for around ten years," she added.
"People are spending more on home improvements. When things go wrong they've got flat-screen televisions and expensive flooring.
"So…it's costing us more [in meeting claims]," she said.
The Association of British Insurers has estimated that the total damage caused by the floods in June and July could touch £2 billion.
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