Ottawa takes a step toward national flood insurance

The prospect of the federal government setting up a low-cost flood insurance scheme in high-risk areas sounds helpful, but would be limited to officials battling to protect flood-prone properties above the beleaguered town of Cache Creek, says one observer.

Bill Blair, federal minister of emergency preparedness, on Thursday added a $31.7-million contribution to Ottawa's year-old promise to devise a national flood insurance program designed to shore up protection for residents in flood-risk areas.

“I think it's helpful as long as people can afford it,” said Tricia Thorpe, the Thompson Nicola Regional District area director for the region around Cache Creek, which has been in a state of emergency for more than a week. “And what is it going to cover?”

Thorpe said her rural constituents in Back Valley to the east of Cache Creek are still too busy fighting to keep roads open and shore up infrastructure to begin counting losses, but added that any insurance should take a “proactive approach” to cover prevention measures, not just recovery.

“And again, I really think if you're looking at climate change and disaster, you need to look at the wildfire piece too,” Thorpe said.

However, Blair's announcement Thursday came as a welcome step while a lot of victims of 2021's flooding events are still recovering 18 months later, said Aaron Sutherland, vice-president for the Pacific and Western region for the Insurance Bureau of Canada.

“We've been pushing the feds for that and we're really pleased to see that the federal government and I think the provincial government have recognized this challenge,” Sutherland said.

Sutherland added that the feds' $31.7-million contribution will cover the “exploratory work to determine how we could design some kind of public-private partnership,” for insurance.

The insurance industry started creating flood insurance in 2015 and came up with plans to cover losses due to overland flooding for about 90 to 95 per cent of the country, he said. Policies would be too expensive to be sustainable in those high-risk areas, which is where federal help comes in.

Blair included the update on the insurance scheme Ottawa promised a year ago as part of his announcement launching a national risk profile, which will examine risks from the three most common disasters that afflict Canadians: earthquakes, wildfires and floods.

Part of that effort will involve the creation of a web portal for communities to access updated data on flood mapping.

“One of the things we're investing in, and we are developing and we'll be introducing hopefully within the next 12 to 18 months, is a plan to enable communities to get real data, accurate and reliable data as to the nature of the risk at any particular location with respect to flooding,” Blair said.

Then that data can be used to help Ottawa shift some of the billions of dollars it spends annually on disaster financial assistance arrangements to a more proactive insurance program, Sutherland said.

“Rather than putting that (spending) on the back end, in terms of helping people recover, you can sort of reposition those funds to say `we're going to use some of those funds to make flood insurance more affordable,'” Sutherland said.

Other voices, however, question why insurance would be a priority when some of the damage from B.C.'s November 2021 flooding resulted from the failure of protective infrastructure.

Flooding destroyed a workshop and a backhoe and then inundated the basement of Bob Marcelet's Merritt home, which he contends “wouldn't have flooded near as badly if their dike hadn't let go.”

Marcelet wasn't insured for flood and didn't qualify for disaster financial assistance after a year of fighting for it. “I don't have a lot of faith in any type of government, whether it's municipal or federal or provincial,” Marcelet said.

If the feds are going to spend money, Marcelet said it would be better spent on fixing infrastructure to prevent flooding in the first place.

Sutherland said the next step must involve figuring out “where it's economical and makes sense to protect these communities from flood, and then have that really difficult conversation (about) where we have built, we likely shouldn't have and we'll need to pull out.”