Dr. Swenja Surminski:

On the specific questions about Cork and what could be done about the immediate situation of businesses not being able to access insurance, I refer to my earlier comment. In the case of Cork I have not followed the discussions and my suggestion might have already happened.

The first suggestion would be to get the insurance industry, business, counsel and local stakeholders around a table and for everyone to be transparent about flood risk. Do we all share the same information about flood risk? If we do not, it could be one of the reasons there are different levels of flood risk information. In certain cases in England, Members of Parliament got involved because some of their constituencies received conflicting flood risk information and public flood risk maps showed something different from what the insurance flood risk maps showed. The question arose of how to manage that. I would suggest an open discussion to ask if everyone agreed on the level of flood risk and whether everyone agreed on what was in the pipeline in terms of defence work and flood risk management work. On that basis it should be fairly logical to establish what insurers would deem acceptable in terms of flood risk at a business level. We could then build on that. It might have already happened but it seems to me to be the logical first step.

We also need to be careful not to jump to the conclusion that more State intervention is what is needed. My rule is that there is a justification for state intervention if access to insurance is blocked and if that has a detrimental impact on home owners, business owners and the like. After the 9/11 attacks, terrorism cover was not available and a lot of businesses ceased to be able to trade so a state solution was put in place immediately. Before we in Ireland can say we are at such a moment, we need to ask what the blockages are which prevent insurance from being available. I get the impression it is not the lack of flood risk management and investment, though usually the first thing one hears from the community and from insurers is that not enough is being done to manage flood risk. This meeting gives me the impression that this is not the problem but we do need to investigate the blockages before we draw the conclusion that there is a case for the State to intervene.

I was asked for certain examples. One thing that came to mind is that Germany, after its floods of two years ago, put in place a mechanism in which local businesses and home owners could only access public compensation money if they could prove that they were not able to insure themselves. In a way, Germany faces almost the opposite problem to us in that the insurance take-up is very low. A point was made about the car scheme for young drivers who were not able to get insurance and one could imagine something similar being put in place as an immediate backstop. First, though, we need to understand what the real blockages are because I am not convinced we really understand them as yet.

Deputy Spring asked what we could do to influence the price or availability of insurance. There are examples of schemes whereby subsidies are given to people facing higher flood risk and flood insurance bills because they live in higher-risk areas. In the US they have such subsidies and one can claim support which goes straight into one's flood insurance premium. It is a linked system whereby the state subsidises a person's flood insurance bill.

Rate controls could be set by setting a cap. In that way one could say flood insurance is capped. There is an overall rate that could be linked to flood risk levels. For example, if one lives in a one in 100 year flood zone, the price is X. That is what is being tried with Flood Re in England, but it is being linked to council tax levels. Basically, one's council tax determines what one pays for flood insurance. The problem that creates is that it is not linked to the flood risk issue. I think there needs to be at least some way of linking it back to the flood risk, not just the council tax band. There are some examples and options as to what one can do.