Dáil Éireann Debate, Tuesday - 12 February 2019
160. Deputy Michael McGrath asked the Minister for Finance the percentage of property owners who have secured flood insurance since OPW flood schemes were put in place as a result of the flood relief works; the number or percentage of property owners who have secured flood insurance without excess; and if he will make a statement on the matter. [6525/19]
Amharc ar fhreagraI am conscious of the difficulties that the absence or withdrawal of flood insurance cover can cause to homeowners and businesses, and that is one of the reasons the Government has been prioritising investment in flood defences over the last number of years.
However, you should be aware that the provision of insurance is a commercial matter for insurance companies, which has to be based on a proper assessment of the risks they are willing to accept. This assessment will in many cases include insurers own presumptions based on their private modelling and research. Consequently, neither the Government nor the Central Bank can interfere in the provision or pricing of insurance products or have the power to direct insurance companies to provide flood cover to specific individuals or businesses. This position is reinforced by the EU framework for insurance which expressly prohibits Member States from doing so.
Government policy in relation to flooding is focused on the development of a sustainable, planned and risk-based approach to dealing with flooding problems. This in turn should lead to the increased availability of flood insurance. To achieve this aim, there is a focus on:
- prioritising spending on flood relief measures by the Office of Public Works (OPW) and relevant local authorities;
- development and implementation of plans by the OPW to implement flood relief schemes; and,
- ongoing communication between the OPW and the insurance industry, in order to reach a better understanding about the provision of flood cover in marginal areas.
The above approach is complemented by a Memorandum of Understanding between the OPW and Insurance Ireland, which provides for the exchange of data in relation to completed flood defence schemes which should provide a basis for the increased provision of flood insurance in areas where works have been completed. In this regard, the Insurance Ireland/OPW working group, which the Department of Finance attends, now meets on a quarterly basis to support the information flow and improve the understanding of issues between both parties.
In order to improve the quality of the data and to get a greater idea of the impact of any new flood defence scheme, the OPW and the Department of Finance are currently working with the insurance industry to measure baseline flood cover ahead of schemes being completed. This aims to provide a ‘before’ and ‘after’ of flood insurance cover for each community to be protected in the future. The OPW has advised me that data relating to four schemes has been provided to Insurance Ireland, to pilot the comparative analysis of the levels of flood cover before and after schemes have been completed.
Finally, since agreement of the Memorandum of Understanding in 2014, the OPW has provided data on 18 completed flood defence schemes, to the insurance industry. Insurance Ireland has informed me that the most recent Insurance Ireland survey indicates that of the completed defence schemes, 90% of policies in areas benefitting from permanent flood defences include flood cover, while 75% of policies in areas benefitting from demountable defences include flood cover. Taken together, 82% of policies in the areas benefitting from these flood defences included flood cover in 2017.
