Canada has not seen a proper floodplain map since 1996, when a previous Liberal government enacted budget cuts that effectively shut down Environment Canada’s Flood Damage Reduction Program. In March, however, Federal Minister of Public Safety and Emergency Preparedness Ralph Goodale announced that Environment Canada would restart the project in collaboration with the private sector.
Updated floodplain maps, which would reflect current changes in climate and topography, would allow the government, developers and insurers to take pre-emptive action to save homeowners from building in vulnerable areas and save them millions of dollars in water damage costs.
However, according to Dr. Blair Feltmate, head of the Intact Centre on Climate Adaptation at the University of Waterloo, flood maps could actually do more harm than good to consumers.
“Floodplain maps are politically toxic – nobody wants to take the lead in developing them and releasing them publicly,” Feltmate said at the 2017 Flood Risk Summit. “Governments that would support developing floodplain maps would take a lot of heat from current homeowners, who may be now identified as being in a floodplain. All of a sudden you have a $1 million home that is stigmatized and devalued down to half its current value, where it’s unsellable.”
As controversial as the decision is, it provides an opportunity for MGAs and the industry as a whole to play a more active role in protecting properties from flooding.
“There isn’t anything we can do about the unpredictability of the seasons, which is why it’s so important that brokers help their customers understand what they could be exposed to and assist them with choosing the right coverage for their needs,” said Barry Owen, Aviva Canada’s assistant vice-president of personal lines propositions. “Brokers now have several markets offering flood insurance, but not all products are created equal, so they need to understand the differences.”