Ministers keen on U.K.’s Flood Re risk pool model
Canadian emergency management ministers have shown particular interest in a high risk pool such as the U.K.’s public national flood reinsurance program Flood Re, said Craig Stewart, the Insurance Bureau of Canada’s vp of federal affairs.
Last week the IBC presented options to federal, provincial and territorial emergency management ministers on how to address the financial risk of Canadians at high risk of flood (Thompson’s daily May 29th).
Mr. Stewart said IBC presented models from countries with varied approaches to the issue, focusing on the Netherlands, Australia, the U.K. and the U.S. He said the Netherlands focuses heavily on strategic retreat of water, the U.K. has Flood Re, and Australia focuses on mitigation and urging private market solutions. But he said Canada needs its own solution.
“The risk profile is different (in Canada) and our provincial, federal and municipal governance structure is different and also we think that each country and model has something to offer,” Mr. Stewart said. “(The presentation) focused on the public policy benefits of each and suggested that a unique approach was needed in Canada that could draw upon several of the international models.”And given the severe flooding this past month in New Brunswick and B.C., it is evident that finding the right solution is as urgent as ever, he added.“Governments right now are using taxpayer dollars to subsidize those at high risk and there is widespread recognition that this is inappropriate and that another approach is needed,” Mr. Stewart said.
“We believe that we are in a transition period and that a roadmap to success would include elevating consumer awareness, government investment in mitigation to de-risk the worst areas, the rollout of insurance products that protect consumers effectively and then finally a solution for those high risk Canadians whose risk cannot be mitigated.”
The IBC estimates that 800,000 properties in Canada, both rural and urban, are at high risk of flooding and half of those could be mitigated.
In six months, the IBC is to present refined options to the government following multi-stakeholder consultation.