Dáil Éireann Debate, Thursday - 23 November 2023
111. Deputy Pádraig O'Sullivan asked the Minister for Finance if he will engage with the insurance industry to discuss the provision of flood cover, particularly into the future due to the worsening effects of climate change; and if he will make a statement on the matter. [51210/23]
View answerAs Minister for Finance, I have policy responsibility for the development of the legal framework governing financial services regulation, including for the insurance sector. It should be noted that the provision of insurance cover and the price at which it is offered is a commercial matter for those providers and is based on an assessment of the risks they are willing to accept. Therefore, under the EU Solvency II Directive, neither the Minister for Finance nor the Central Bank can compel insurers to provide such cover. The insurance industry has informed the Department that firms examine the claims history of the individual risk, the risk of flooding in the area and consider any flood protection measures when deciding what underwriting action to take.
Government policy in relation to flooding is focused on the development of a sustainable, planned and risk-based approach to dealing with this issue. The cornerstone of this approach is the €1.3 billion committed to the delivery of flood relief schemes over the lifetime of the National Development Plan (NDP) 2021-2030. According to the OPW, the economic benefit in flood damage and losses avoided from work completed thus far has been estimated to be in the region of €1.9 billion. This investment has allowed the OPW, since 2018, to treble the number of flood relief schemes at design and construction stage to almost 90. This approach of prioritising schemes means that, together with the 53 schemes complete protecting communities across the country, work is underway or complete to protect 80 per cent of at-risk properties nationwide.
Where such defences have been built, there is the reasonable expectation that insurers will provide cover. Discussions with the insurance industry continue to take place as part of an OPW-Insurance Ireland Memorandum of Understanding Working Group that meets on a regular basis. This focuses upon how the levels of insurance cover might be improved in areas where flood defence works have been completed. The Department also participates in the OPW chaired Interdepartmental Flood Policy Coordination Group along with the Department of Housing and Local Government and other stakeholders.
As has been the case, the Department of Finance will actively encourage industry to have a more responsive approach to the matter. In terms of domestic and international policy developments it will engage with the Central Bank of Ireland; and also at the EU and OECD level on these issues as they arise where the so-called ‘insurance protection gap’ is gaining increased prominence.
It may interest the Deputy that Insurance Ireland operates an Insurance Information Service for those who have queries, complaints or difficulties in relation to obtaining insurance, which can be accessed at feedback@insuranceireland.eu. Likewise, Brokers Ireland, the representative body for insurance brokers in Ireland, can be contacted. They have access to a wide range of providers and products, and can offer advice for customers in sourcing cover. They can be reached at 01 6613067.
Finally, please be assured that Government will continue to engage on all aspects of insurance reform, including flood cover issues, and that every effort is being made to encourage a responsive approach from the insurance industry, particularly in light of recent events. Minister of State Carroll MacNeill T.D. will be meeting with the CEOs of the major insurers later this month and will be pressing them to deal with their affected policy holders, fairly and efficiently and in-line with the Central Banks consumer protection code.
