As the state government warns flood damage in NSW could exceed $500 million and more than 5000 properties remain isolated, concerns have been raised that the federal response to a disaster review will price people out of insurance.

''It's inevitable. Some people will just be completely out of the market,'' the principal solicitor at the Insurance Law Service, Katherine Lane, said.

''I think it's really good that we're going to do that mapping but it will lead to strange results with the pricing … Let's not let them use flood mapping as an excuse not to ensure people have got coverage.''

The government has supported a recommendation from the Natural Disaster Insurance Review calling for the creation of a central body to manage all flood risk data.

The data is presently held on an ad hoc basis by councils and in secret by insurers. But lawyers warn the national map will give the insurance industry an excuse to raise premiums.

The NRMA has increased premiums for some properties since last year's floods but would not disclose where and by how much. So has the Suncorp Group, which includes AAMI, GIO and APIA.

''We've got to obviously manage our costs. We paid out more than $1 billion in claims as a result of those events,'' the head of public policy at Suncorp, Chris Newlan, said.

A spokesman for the Insurance Council of Australia did not respond specifically to questions about whether the mapping would be used to increase premiums but said the body welcomed its introduction.

The office of the Minister for Financial Services, Bill Shorten, said $12 million was being spent over four years to improve flood data. A spokesman said the improved data would increase the availability of flood cover.

Last night, more than 20 helicopters were delivering food and water to the 5000 isolated properties in NSW.