By: Luke Jones, Published on February 2, 2018 04:29 PM, Last Update on March 1, 2018 01:31 PM
Canadian insurance companies are once again calling on governments to help them cover homeowners in high-risk flood areas. Companies cannot afford to be the sole cover for home and tenant insurance customers and the government must offer some kind of protection.
“We have to resolve the issue of high-risk properties, because the insurance industry in the current environment cannot be there to save high-risk properties,” said Alain Thibault, chairman, president and CEO of CADRI. “It has to be a concerted effort by various stakeholders, including government.”
Thibault was talking at an Ottawa-based catastrophe risk conference and was joined by other delegates in his call for government help. Bonnie Crombie, Mayor of Mississauga has an interesting way government could aid flood affected homeowners… buy them out.
“Along Cooksville Creek in Mississauga, time after time with rainstorms, [the homeowners] are repeatedly flooded,” she said. “They have built on flood plain—probably much of Mississauga is built on flood plain, in fact. None of those residents qualify for flood insurance any longer.
“We have taken the very bold step to actually purchase about 50 homes in the flood plain, at market value, for parkland. We needed the parkland in our downtown area.”
That model has worked in Mississauga, but similar projects in other areas have not worked, claimed Glenn McGillivray, managing director of the Institute for Catastrophic Loss Reduction. “We have a failed buyout program in southern Alberta,” McGillivray said a day later. “It was a voluntary program that by all accounts was not a success.”