Homes in areas prone to flooding may become uninsurable if action is not taken by Government to build flood defences, Irish insurers have warned.
In the last ten days, Hibernian Insurance, which insures one in five Irish households, has agreed payment on almost 500 claims as a result of recent flooding in Dublin, Meath and Cork. It is estimated these floods will cost the insurer €12 to €15 million in claims, five times the amount expected during the same period in an average year.
Mr Dick O'Driscoll, Hibernian's director of underwriting, said yesterday that this was "simply not sustainable".
He called on the Government to take action now to prevent a situation similar to that in the UK, where over two million homeowners living in flood-prone areas were threatened with the prospect of being left uninsured and with their homes virtually unsaleable.
The insurance industry in Britain said it will only continue cover in most cases as long as flood defences are in place by 2007. The UK Government recently announced a £150 million (€234 million) package to develop flood defences in risk areas.
A spokesman for Axa Insurance said the company had also received a substantial increase in the number of claims for November. If flood damage becomes an inevitability rather than a risk in certain areas, the property will be uninsurable, he confirmed.
Currently, owners of properties in some streets in the centre of Cork city and in Clonmel cannot obtain insurance cover, Mr O'Driscoll said, and Government action needed to be taken to avoid flood-exclusion zones spreading to areas such as parts of County Meath, where a number of estates have been built on land subject to repeat flooding. Mr O'Driscoll said excluding further areas from cover was "not the desired situation".
The Irish Insurance Federation (IIF) has called on the Government to establish a national flood defence agency to review river and coastal defences and identify flood blackspots. In a separate insurance concern yesterday, the Fine Gael spokesman for Enterprise, Trade and Employment, Mr Phil Hogan, said that members of the Garda Síochána, prison officers and the security industry may not be able to obtain property or motor insurance cover due to changes in the definition of terrorism.
After September 11th, terrorism cover became unavailable on the Irish market. Terrorism is commonly defined as violence committed for political purposes by any person or group whether acting alone or in connection with an organisation or government.
Mr Martin Long, spokesman for the IIF, denied yesterday that people whose house or car was damaged in attacks made due to religious bigotry would not receive any payout. Terrorism exclusions in insurance policies referred "a large-scale attack that would challenge a government", he said, and would not apply to a riot situation or small-scale property damage.
