The Deputy will be aware that the provision of insurance is a commercial matter for insurance companies, which is 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 I, as Minister for Finance, 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 (Solvency II Directive) which expressly prohibits Member States from doing so.
Having said that, I 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.
In May last year, the OPW completed the most extensive and comprehensive study on flood risk through the National Catchment-based Flood Risk Assessment and Management (CFRAM) Programme which identified the flooding risk to 300 communities. The Flood Risk Management Plans prepared under the CFRAM Programme identify 118 flood relief schemes in addition to the 35 flood relief projects that are already in design and development under the existing capital programme. I have been informed by the OPW that Flood Relief Works have already been completed in a number of areas in Limerick City, including Clancy’s Stand and Harry’s Mall (mid 2000’s) and Howley’s Quay (2012).
Current government policy in relation to increasing flood insurance coverage is focused on the development of a sustainable, planned and risk-based approach to managing flooding problems. This it believes should in turn 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,
- implementation of flood relief management plans by the OPW to implement flood relief schemes, and
- maintaining channels of communication between the OPW and the insurance industry, in order to reach a better understanding about the provision of flood cover in marginal areas.
This commitment is underpinned by a significant capital works investment programme to be delivered by the OPW and Local Authorities, and 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.
The nature of this arrangement is that, overall, there has been an increase in the provision of flood insurance cover observed in areas protected by these schemes over the period 2015 to 2019, according to Insurance Ireland Flood Survey Results. It should be noted that my Department is continuing to actively examine what can be done to increase the level of cover in areas with demountable defences.
In terms of the use of flood maps and insurance provision, flood maps are community based maps and provide a useful resource for planning and cannot be used for commercial purposes. The Disclaimer and Conditions for Use of OPW Flood Maps on floodinfo.ie includes a provision that users of the website must not use the flood maps, or any other content of the website, for commercial purposes. It should be noted that the insurance industry has informed OPW that it uses its own flood modelling tools for assessing the level of risk that it is willing to underwrite in relation to individual properties, and does not use the OPW Flood Maps to inform its flood modelling.
Finally, you should be aware that a consumer can make a complaint to the Financial Services and Pensions Ombudsman in relation to any dealings with a Financial Services or Insurance provider during which they feel they have been unfairly treated. In addition, individuals who are experiencing difficulty in obtaining flood insurance or believe that they are being treated unfairly may contact Insurance Ireland which operates a free Insurance Information Service for those who have queries, complaints or difficulties in relation to insurance ((01 676 1914 or firstname.lastname@example.org).