"Climate change is happening now, and we need to act now to manage it," said Association of British Insurers' (ABI) head Stephen Haddrill.

"Flooding is expensive, disruptive and distressing. This report shows that Britain needs a sustained and prolonged investment in coastal flood defences. This investment needs to start now," he told a ABI meeting in central London.

Scientists say global average temperatures could rise by between two and six degrees Celsius above pre-industrial levels over the coming century due mainly to so-called greenhouse gases from burning fossil fuels for power and transport.

Global warming would cause more extreme weather events such as storms and droughts and also start to melt the giant polar ice caps, putting millions more people in coastal areas at risk from rising sea levels.

The ABI report used catastrophe modelling techniques to calculate the effects of a sea level rise of 40 cm as early as 2040. It said improvements to flood management could cut the cost of a single major flood to 6.8 billion pounds.

Central London -- and in particular its economically crucial finance district -- lies in the floodplain of the Thames river and its tributaries and is especially vulnerable to flooding.

Its major flood defence is the 23-year-old Thames Barrier. It is now being closed on average some seven times a year but is expected to be shut more than twice a month by the time it reaches the end of its projected design life in 2030.

Several possibilities are being considered, including a new barrier further downstream and removing some farmland flood defences in the estuary to allow surges to dissipate rather than being channelled up the river.

The ABI report said up to 4 billion pounds had to be spent on improving the Thames Barrier and central London's flood defences, with an extra 2 billion pounds on the tidal flood plain to the seaward side of the barrier.

Along the east coast -- inundated by the storm surge floods of 1953 which killed more than 300 people and caused huge damage -- flood defence spending of up to 2.6 billion pounds was needed, the report said.

Without the work, some 404,000 properties along the exposed east coast of England would be at risk from flooding, up from 270,000 now. Because of the increasing age of the population in coastal areas, more elderly people would also be threatened.

The report echoes similar warnings from other research groups. British environment watchdog, the Environment Agency, says some 5 million people and 2 million properties are in flood risk areas of England and Wales.