One in 20 buildings in Ireland have difficulty accessing flood insurance, which includes those that cannot get insurance and those who have to pay exceptionally high rates of cover.
That is the standout finding of a 2024 Central Bank of Ireland study which analysed flood risk of every residential and commercial address in the State down to Eircode level.
Ireland has about two million buildings, of which 89 per cent are residential. It assesses whether each address is likely to be able to access flood insurance, based on current underwriting criteria of insurance companies.
The antagonist making the position of building owners precarious is climate change, with the biggest risk to property being associated flooding and rising seas generated by a storm – otherwise known as storm surges.
The central bank’s flood protection gap report highlights “the shortfall between the cost of flooding in Ireland and that portion of the cost which is insured”.
The gap must be closed, otherwise more people won’t get cover or face escalating insurance costs. Left unaddressed, they are left to confront consequences of a warming world on their doorsteps.
“Lack of access to insurance can affect Irish communities and businesses in a very real way, impairing recovery from a flood and creating a need for Government to provide financial supports or compensation,” it says.
Risk can affect availability of credit – mortgages and loans to small businesses – in at-risk areas, while economic losses can hit the State.
The main response is a €1.3 billion programme to provide flood defences at more than 100 locations, overseen by the Office of Public Works.
The shortfall between economic and insured losses can be caused by the lack of access to insurance or by the choice not to purchase it. Cover is not obligatory.
Some 54 per cent of the “protection gap” is concentrated in five counties: Dublin, Cork, Kildare, Clare and Louth. The main threats are river flooding – notably in cities at estuaries, including Cork and Limerick – and coastal flooding.
The estimated “average annual loss” of inland – river and surface water – flooding is €101 million a year, the report finds. That is largely borne by those having difficulty getting cover. Severe losses can be much higher in event of a single extreme storm or flood. The insurance sector is bracing itself for a €1 billion event hit that would be a storm lingering over a highly-populated Dublin.
In 2020, Gamma Location Intelligence (GLI), a geospatial analytics consultancy that models and maps for local authorities and insurance companies, found more than 70,000 Irish addresses – 88 per cent residential – will be at a heightened risk of coastal flooding by 2050. Properties in Dublin, Louth, Limerick, Clare and Galway are the most vulnerable, it predicted.
Richard Cantwell, GLI’s head of spatial and sustainability, says the data is constantly being revised, prompting them to decide to redo their analysis.
“As improved data becomes available, climate models are refreshed, data about buildings becomes more detailed and risk profiles are adjusted,” he says.
There are more than 100,000 new buildings to consider.
“Almost 97,000 of these are residential, which includes 5,100 apartment buildings. Given the increased number of properties, the availability of new and refreshed data, plus the rate of climate change, analysing the combined influence of these factors allows us to identify trends,” adds Cantwell.
In 2019, Climatologist Prof John Sweeney said it was only a matter of time before a 3m storm surge would hit Ireland.
“We’ve been lucky so far in that we have had storm surges when the tide has been out or we haven’t had a depression arriving at the same time as the storm surge,” says Sweeney.
His prediction still stands today, but the risk has increased, he says.
“It constantly increases as sea level rises. This is compounded by increased intensity of storms – though it’s too early to say if this is a long-term trend,” he says.
“And there is increased vulnerability as we build close to the coast and on floodplains,” adds Sweeney.
For many householders, accelerating sea-level rise is exacerbated by coastal erosion, “especially on soft sediments along the east coast”. This brings additional damage due to saltwater.
The number of homes at risk of falling into the sea has risen by 173 per cent over the past five years, according to an internal Department of the Environment, Climate and Communications report cited by news outlet, the Journal Investigates.
The east coast is most vulnerable due to its soft sediment terrain of sand and gravel. On top of this, sea-level rise with more intense waves is built in for the next 300 years.
Flood risk will be of ongoing concern, says Dr Emily Duffy of the central bank’s insurance directorate.
“We have recently seen with Storm Éowyn the serious impact that severe weather can have on Ireland. Climate change is already causing more severe storms and floods, and that’s going to continue,” she says.
“It’s likely the protection gap will grow in future – that means potential challenges regarding access or affordability of insurance for people, greater economic losses and indeed additional strain on Government spending in the aftermath of serious flooding.”
When their report was presented to key stakeholders, its then director of insurance Domhnall Cullinan warned: “I cannot emphasise strongly enough: complacency is a significant risk here.
“Ireland has broadly managed flood risk to date, but as with many other aspects of climate change, we cannot assume current approaches will remain viable.”
He says “the clock is ticking and the window of opportunity to take preventable action may be closing faster than we realise”.
