“The insurance sector has fully played its role”: one year after the floods, 10% of files are still being processed

1.7 billion. This is the newest figure to emerge from the July 2021 flood report presented on Monday by the professional insurance union Assuralia. It is equivalent to the compensation paid to insured victims in the three regions of the country, all categories combined, as of May 31. This represents nearly 70% of the 2.5 billion that insurers will have to pay to compensate the victims of this unprecedented natural disaster.

Files pending

The insurers wanted to convey the message that they did their best to help the victims, including by employing retirees or interrupting their holidays. Hence the title of the press release announcing the 90% of victims fully or almost fully compensated. These are therefore mainly individuals, while many companies are still waiting for reimbursement one year after these dramatic events. The balance to be repaid indeed still represents 800 million euros compared to a total of 2.5 billion.

Four reasons explain why 10% of files are still being processed: the insured must still provide supporting documents for their claims; several expert appraisals are necessary, discussions are underway with the counter-expert (approximately 20 to 25% of files have been the subject of a counter-expert); the lack of availability of certain trades.

“Faced with this unprecedented event, the insurance sector has fully played its role. Of course our action continues. It has been tireless work for a long period”underlined the vice-president of Assuralia Etienne Bouas-Laurent (CEO of Axa Belgium).

For insurers, there are several lessons to learn. One: there needs to be more emphasis on prevention. Two: better use of data combined with high-performance technology should make it possible to better identify areas at risk. Three: It’s important to be “insured and well insured. Many policyholders were surprised by the discrepancy between compensation and the amounts insured”. Four: the claims caused by the floods have shown the essential role played by the profession of adjuster. “This requires a better framework in terms of training”continues the vice-president.

According to him, it is all the more important to draw lessons from the fact that natural disasters have increased very sharply in recent years (+5%), ie a higher increase than economic growth. “This acceleration is certainly not disconnected from the phenomenon of global warming.”And to add that the amount of 2.5 billion of the total cost represents 1% of natural disasters in the world. “This is a major challenge for the years to come.”

Private public partnership

Faced with this challenge, two models exist at the insurance level. On the one hand, there is that of the optional guarantee which is in force in particular in Germany. On the other, the inclusive system (as in Belgium or France) where fire insurance compulsorily covers natural disasters. “It is a choice that we support, which is close to the pooling of risks”, emphasizes Etienne Bouas-Laurent again. “But in the absence of a public/private partnership, pooling does not work. Premiums will become unpayable and some players will withdraw from the market”warns the president of Assuralia and CEO of PV&V, Hilde Vernaillen.

It is to update this partnership within the framework of the 2005 law that discussions have been initiated between the regional and federal entities and the insurers. “Discussions are going in the right direction. There is a good will from the parties around the table to set up a sustainable system. We hope for an agreement in principle for the summer”indicated Hein Lannoy the CEO of Assuralia.

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