During a recent speech, Don Forgeron, president and CEO of the Insurance Bureau of Canada, said that severe weather is becoming a significant issue throughout the world. And for Canada, flooding is chief among them, leading to millions of dollars in insurance claims.
"Insured water losses in [Halifax] rose from more than $20 million in 2005 to more than $38 million in 2009," said Forgeron. "In other words, they almost doubled in four years."
Water damage is an even bigger issue on the world stage, as data from reinsurance company Munich Re indicates that between 1980 and 2010, flood disasters have more than tripled, leading to insured losses or nearly $380 billion, IBC notes.
As a result of the increase in flood incidence and costs to fix damage, some suggest that it may be wise to raise taxes and insurance premiums, Forgeron indicated. However, Forgeron said this would only compound the issue.
"Insurance premiums and taxes are not the solution to this problem. No," said Forgeron. "We need a collaborative effort and insightful public policy. As a society, as businessmen, and as neighbours, we need to join together."
Forgeron then noted the instances in which flooding and water damage has impacted several provinces recently, such as two years ago, when 200 millimetres of rain over a four-day stretch led more than 100 homeowners in Nova Scotia to abandon their properties due to flooding. And prior to that, Tropical Storm Earl affected hundreds of thousands of Canadians as power outages left people in the dark for days.
Fortunately, governmental leaders are acknowledging the frequency of severe weather and investing in stronger water and sewage infrastructure projects, Forgeron noted. However, more can be done.
"The $150 million the federal government has committed to adaptation is a good start but it's not enough to address the adaptation problems our country faces," said Forgeron. "We need focused, intergovernmental co-operation to build resilience to severe weather patterns and minimize associated economic and insured losses."
Because homeowners insurance doesn't cover overland flooding in Canada, the IBC says homeowners should take as many preventive steps as necessary to diminish the risk of flooding. This may include keeping floor drains clear of obstructions to prevent clogging, installing a sump pump, installing backflow valves for all home appliances that have sewer connections and placing all important documents - such as photographs, living wills or insurance policies - in a safe-deposit box or waterproof container.
"Homeowners should also talk to their insurance representative about purchasing sewer backup coverage as an add-on to their insurance policy," said James Geuzebroek, acting vice president for IBC.
He added that while sewer backup coverage is advisable for everyone in Canada to get, it may be particularly important for homeowners who live in low-lying areas, as they are at more risk for flooding.
