New modelling shows the UK’s inland flood defences save £1.1 billion ($2.02 billion) in damage every year, the Association of British Insurers (ABI) says.

The Flood Re modelling is based on thousands of weather simulations. It shows inland flooding would cost £1.8 billion ($3.3 billion) every year without the defences.

This is the first time the financial contribution of levees has been quantified in this way.

The Government spends about £600 million ($1.1 billion) a year building and maintaining flood levees, with Cumbria, Yorkshire, Somerset and the Welsh valleys all flood-prone.

Residential buildings benefit from 42% of the annual savings, while lower socioeconomic classes benefit from 70% of the sum.

The financial impact of less severe floods is reduced by an average of 68%.

“Faced with the growing threat of climate change, there is a clear financial argument for investing in flood defences,” ABI Director of General Insurance Policy James Dalton said.

“The barriers, walls and natural defences that prevent greater damage being done by the UK’s rivers during times of extreme weather make economic sense, but they must keep pace with the threat if they are to continue being effective.”

The ABI has welcomed the Government’s target for zero greenhouse gas emissions by 2050.

Director-General Huw Evans labels it “a welcome effort to address the underlying causes” of climate change.

“Insurers are on the front line, dealing with the results of rising temperatures and changing investment needs, and so understand better than most the serious implications of a changing climate,” he said.

“We need a sustained and ambitious response to protect homes, businesses and communities around the world.”