Written answers

Monday, 11 September 2017

Department of Finance

Flood Risk Insurance Cover Provision

Photo of Paul MurphyPaul Murphy (Dublin South West, Solidarity)
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156. To ask the Minister for Finance if his attention has been drawn to the fact that houses that have not experienced flooding and are in areas that have not experienced flooding in more than 30 years following works are now being denied flood insurance cover, such as in an area (details supplied); if his attention has been further drawn to the extent of the issue; if he will take measures to have the works carried out in the aforementioned area included on the memorandum of understanding between the OPW and an organisation; and if he will make a statement on the matter. [37977/17]

Photo of Paschal DonohoePaschal Donohoe (Dublin Central, Fine Gael)
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I am conscious of the difficulties that the absence or withdrawal of flood insurance cover can cause to home owners and businesses alike, and that is one of the reasons the Government has been prioritising investment in flood defences over the last number of years. 

However, the provision of insurance cover and the price at which it is offered is a commercial matter for insurance companies and is based on an assessment of the risks they are willing to accept and adequate provisioning to meet those risks.  As Minister for Finance I have responsibility for the development of the legal framework governing financial regulation, and neither I, nor the Central Bank of Ireland, 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 adopting rules which require insurance companies to obtain prior approval of the pricing or terms and conditions of insurance products.  

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   

- improving 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. 

Insurance Ireland has informed me that its members, since 1 June 2014, have factored data on all completed flood defence schemes, provided by the OPW, into its assessment of flood risk within these areas.  This information has been provided as part of an information sharing arrangement entered into between OPW and Insurance Ireland (Memorandum of Understanding). The nature of this arrangement is such that it should lead to a greater availability of flood cover in previously higher risk areas, and at better prices. 

While it is not possible for me to comment in detail on individual cases without the full facts, I am advised by the OPW that work was completed on the River Dodder Tidal Scheme, the details of which have been shared with the Insurance Industry. Work is continuing on the River Dodder phases C, D, & E and details of the defended area will also be shared with Insurance Ireland upon completion in line with the Memorandum of Understanding.

Separately, the Lower Dodder Road was mapped as part of the CFRAM study which identified only a limited risk of flooding at 1% event and no additional flood defences have been proposed.

Finally, you should be aware that a consumer can make a complaint to the Financial Services 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.

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