Thursday 22 March 2018

Embarrassment for the Government as insurance industry refuses to budge despite intense pressure

The Taoiseach pictured examining the floods a few weeks ago. Brian Lawless/PA Wire
The Taoiseach pictured examining the floods a few weeks ago. Brian Lawless/PA Wire

Political Correspondent

THE insurance industry is still refusing to provide cover to homes in areas where flood defences have been put in place.

 In a major embarrassment for the Government, the insurance industry is standing by its staunch criticism of the use of temporary flood defences, or so-called ‘demountables’.

 And the industry has admitted that over one in ten properties in areas where there are permanent flood defences do not have cover.

Earlier this month, Taoiseach Enda Kenny hauled representatives of the insurance industry to a meeting in Government Buildings and demanded a report within seven days.

Read more: Flooding havoc as Storm Jonas batters country with 110 kmh gales

But in a blow to Mr Kenny, the insurance industry made no pledges, instead encouraging the Government to create its own “social compensation scheme” for homeowners who cannot secure cover.

“Insurance Ireland encourages the Government to place the emphasis on fixed defence standards built and maintained to the 1:100 year standard in future as this delivers the best solution to policyholders and the insurance sector. However, we recognise that this is not always possible,” the letter states.

“Equally, it is not possible to achieve a 100% rate of flood insurance cover nationally for the reasons outlined in this letter. In short therefore, if the Government is minded to develop a form of social compensation scheme for properties that cannot get flood cover, Insurance Ireland is prepared to work with the Government to explore alternative solutions.”

But  the insurance industry said its members remained concerned about providing cover in areas which are protected by demountables.

“Insurance Ireland has always insisted that the fixed defence approach is essential when building flood defences and our findings continue to show that flood coverage rates are at their highest where fixed defences are built.

“We have canvassed our members for their views on demountable flood defences. There is no standard position because insurers make their own individual decisions on whether to provide flood cover and what premium to charge. However all of our members have concerns about demountable defences and we will elaborate on these concerns below.”

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