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Flood Risk Insurance Cover

Dáil Éireann Debate, Tuesday - 25 February 2014

Tuesday, 25 February 2014

Questions (173)

Gerry Adams

Question:

173. Deputy Gerry Adams asked the Minister for Finance his plans to develop a State-funded financial aid package for householders unable to get insurance cover for flood damage, because of where they live. [9172/14]

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Written answers

The possibility of developing a scheme whereby the state would pay compensation to those who have been flooded has been examined. However, the difficulty of forecasting severe weather events means that it is difficult to quantify the cost of a state-funded financial aid package in any particular year. These costs would be in addition to the normal infrastructure costs which arise from flooding such as repair of roads, bridges etc. Furthermore, there exists a very real possibility that industry would have a strong incentive to discontinue the providing flood cover to policyholders in medium and high risk areas thus increasing the potential cost of the scheme over time. So it has the potential to undermine the nature of the existing private insurance regime, making it difficult to withdraw an indemnity, even if introduced on a short-term basis.

Humanitarian assistance is being provided in areas affected by flooding under a new Department of Social Protection Humanitarian Assistance Scheme which has been allocated of up to €25 million. It provides means-tested financial support to people who have suffered damage to their homes as a result of the flooding. Government policy in relation to flooding aims to address the underlying problem through appropriate remedial works where this is economically feasible. The Office of Public Works is committed to alleviating the impact of flooding through the provision of defences based on a comprehensive assessment of flood risk throughout the country and development of flood risk management plans for the areas most at risk under the National Catchment Flood Risk Assessment & Management (CFRAM) Programme.

This commitment is underpinned by a very significant capital works investment programme which will see up to €225 million being spent on flood relief measures over a five year period from 2012 to 2016. Works are completed on a prioritised basis. Once these works are completed the availability of flood insurance in affected areas would be expected to increase.

In addition, the OPW and the Insurance Ireland have been engaged in discussions to agree on a sustainable system of information sharing in relation to completed flood alleviation schemes and works undertaken by the OPW or, in certain instances, by local authorities with OPW funding, and where the standard of protection afforded by these works could be verified. There is agreement in principle but with some operational details to be finally sorted by the insurance companies. The outcome of these discussions means that the insurance industry will have a much greater understanding of the extent of the protection provided by flood defence works and will therefore be in a position to provide the necessary flood cover to householders in areas where works have been completed.

In cases where individuals who are experiencing difficulty in obtaining flood insurance believe that they are being treated unfairly, they can contact Insurance Ireland which operates a free Insurance Information Service for those who have queries, complaints or difficulties in relation to insurance. Their service can be contacted at (01) 676 1914 or by email at info@insuranceireland.eu.

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