Noel McCarthy (Cork East, Fine Gael)
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72. To ask the Minister for Finance further to Parliamentary Question No. 442 of 19 March 2025, to provide an update on any further engagement his Department has had with insurance providers regarding the difficulty faced in obtaining insurance cover by households previously affected by flooding; and if he will make a statement on the matter. [28157/25]

Paschal Donohoe (Dublin Central, Fine Gael)
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As Minister for Finance, I have policy responsibility for the development of the legal framework governing financial services regulation, including the insurance sector. In terms of the challenges associated with obtaining flood cover, the provision of such cover is a commercial matter for insurance companies, based on an actuarial assessment of the risks they are willing to accept. Government cannot interfere in the provision or pricing of insurance, or direct insurers as to what cover is provided, as is reinforced by the EU framework for insurance (Solvency II Directive).

I would like to reiterate that the Government remains committed to protecting Ireland’s present and future generations by investing in climate adaptation measures to manage the impacts of extreme weather. As noted in Parliamentary Question No. 442 of 19 March 2025, €1.3 billion has been committed to the delivery of flood relief schemes over the lifetime of the National Development Plan (NDP) to 2030. This will protect approximately 23,000 properties across various communities from river and coastal flood risk. Nationally, 55 schemes have been completed, at a cost of €550m, which are providing protection to over 13,000 properties and an economic benefit to the State in damage and losses avoided estimated to be in the region of €2 billion.

The Department continues to engage with the insurance industry on all aspects of insurance reform, including flood cover issues. These matters are a priority for the Government and efforts continue to be made to encourage a responsive approach to the provision of flood insurance from the insurance industry.

A key focus of Government is the development of a new Action Plan on Insurance Reform which builds on the 2020 Plan that introduced major changes, including the rebalancing of the Duty of Care, reforms to the Injuries Resolution Board, and the implementation of new Personal Injuries Guidelines. The new Action Plan will focus on encouraging further competition in the market and working with stakeholders to enhance affordability and transparency across all types of insurance. To support this, Minister of State Troy, and I, recently concluded the public consultation phase of the new Action Plan, which included seeking feedback from stakeholders on how to address the climate insurance protection gap.

Recognising the long-term risk of climate change on insurers and insurability, the Department of Finance continues to monitor international developments, engage with the Central Bank of Ireland, the insurance industry, and actively participate in cross-departmental working groups on insurance. It is important to note in this regard that the European Commission, IMF, EIOPA and the OECD are separately examining climate risk impacts for insurance and the concept of insurance protection gaps, with recommendations for policymakers to emerge in time. It is important that developments here align with those across the EU, so the Irish market is not ‘out of step’ with others.

Finally, I and Minister of State Troy, along with our officials, will continue to engage on all aspects of insurance reform, including flood cover issues. These matters remain a priority for this Government and efforts continue to be made to encourage a responsive approach from the insurance industry. I will continue to encourage industry to take a responsive approach to treat policyholders promptly and in line with the protections afforded under the Consumer Protection Code in the wake of such flood events.