Patrick Snowball - talks flooding in first UK interview

Thanks to Insurance Insider managing news editor Charlie Thomas, who inteviewed Patrick for this story

UK insurers must be consulted on floods

Charlie Thomas2 February 2016

Insurers have to be brought into flood prevention discussions if the UK is to avoid future flooding disasters, according to former Aviva and Suncorp CEO Patrick Snowball.

Speaking to The Insurance Insider, Snowball said that mitigation was key and that it was "no good for insurers to just be expected to pick up the claim" as it would ultimately lead to higher premiums.

"There has to be a public debate and recognition that insurers can help," he said. "Where we start is with a recognition that insurers have a significant contribution to the debate, rather than just clearing up afterwards."

In 2012, under Snowball's leadership, Australian insurance giant Suncorp refused to write new policies in the Queensland towns of Roma and Emerald after the local government ignored its calls for better flood mitigation.

The decision was greeted with great hostility at the time, but in the two years before the withdrawal Suncorp had collected just A$4mn in premiums across the two towns and paid out A$150mn in claims.

A commission of inquiry was set up to look at the cause and responses to the floods in 2010 and 2011, which resulted in A$20mn being spent on a flood levee jointly funded by governments. Properties protected by the levee are seeing their premiums drop by up to 90 percent.

Snowball doesn't advocate UK insurers following the same path of refusing coverage. He called instead for local governments to work with insurers to work out how best to mitigate flood claims, including by regular dredging of river beds and banks.

"And if you're going to build on a flood plain, you have to build houses in a totally different way - don't use chipboard in kitchens, all electric cables [should be] 1.5 metres up the wall, make sure the floors are made of concrete, and don't put down fitted carpets on wood."