Insurers say Government policy on flood relief is inadequate

The insurance industry has strongly criticised the Government's policy on flood relief, saying the €440 million anti-flood package earmarked for the next 10 to 15 years is "inadequate" and will do little to relieve areas around the country which have proven susceptible to flooding in recent years.

The Irish Insurance Federation has said the flooding last October has resulted in claims to insurance companies of more than €38 million from almost 3,000 policyholders.

While the response of insurers to such incidents had been "swift and personal", the Government's response to flooding was "disappointing" the federation's non-life manager, Mr Michael Horan, said.

"Emergency helplines were immediately advertised by insurers in the media, while companies reassigned staff in order to speed up inspections of flood-damaged properties and to expedite the processing of claims," Mr Horan said. Some 2,791 claims were processed; 1,602 from householders, 910 from businesses and 279 from motorists.

"Following the two floods that took place in 2002, some hope was provided to the beleaguered property owners and insurers alike by the establishment of a review group on Government policy on flood relief," Mr Horan said. "However, the recommendations of the long-awaited report, which was published recently, are inadequate to address the scale of the challenge facing us.

"In particular, given the extent of work which needs to be undertaken, the proposed funding of €440 million over 10 to 15 years for capital works will do little to tackle the vulnerability of many areas of the country to flooding".

The Irish Insurance Federation, which represents 54 member companies, noted that the budget for the Kilkenny City drainage scheme alone was €48 million. The Government needed to act fast to implement a more ambitious and comprehensive action plan to address the Republic's flood-prevention and damage-limitation needs.

It said the floods of October had already resulted in claims of €38.1 million. There were 1,602 claims from householders costing €9.925 million. Some 910 claims had cost the insurance companies €26.251 million, while motor claims cost just over €1.9 million.

Those floods had not proven as costly to the insurance industry as other major weather events of recent years. The storms of December 1997 were most expensive, costing the sector €84 million. Next was the December 1998-January 1999 storm, costing €56 million and floods in November 2000 which cost €51 million.

Flooding in November 2002 cost the insurance sector €50 million, while similar flooding in February of that year cost €37 million. In December 2001, freezing conditions cost the sector €30 million in claims.