TORONTO, Feb. 25, 2016 /CNW/ - Today, the Parliamentary Budget Officer (PBO) released a report showing that the financial costs to the Federal Government due to natural disasters, linked to climate change, are far greater than previously estimated.
"This report is an affirmation of our research at Insurance Bureau of Canada, which shows that climate change is a real and present danger costing government – and Canadians – hundreds of millions of dollars every year," said Craig Stewart, Vice-President, Federal Affairs, IBC. "Extreme weather events driven by climate change have increased in frequency and severity. Canada is not prepared for the increase in damage caused by climate change and primarily flood. As the only G7 country without a national flood program, Canadians, our governments and the insurance industry are dangerously exposed to severe weather risks."
Today, Don Forgeron, President & CEO, IBC, is speaking at the Economic Club of Canada in Halifax. He will outline the significant costs of climate change to Canadian taxpayers, governments and businesses, and call for a collaborative national flood program. IBC is proposing a framework for the financial management of flood risk, with shared responsibilities between the insurance industry, all tiers of government and consumers.
IBC has just completed flood risk mapping across all 10 provinces, showing that 19% of Canadian households are at risk of flood.
The Disaster Financial Assistance Arrangements (DFAA), operated by Public Safety Canada, is the primary source of financial assistance for provinces in the case of disasters, including ice storms, large forest fires and floods. According the PBO the DFAA is underfunded in the government's fiscal framework, with the PBO pegging future expected liabilities to the Federal Government through the DFAA at $670 million per year due to flooding. Costs have risen from an average of $100 million per year in the 1990s to over $600 million a year this decade, with three-quarters of these expenditures related to floods. In 2013, costs reached a record $1.4 billion, largely as a result of two flooding disasters, in Alberta and Ontario.
"Now is the time for action," added Stewart. "With the First Ministers meeting in Vancouver next week, it is clear that any national strategy on climate change must include a comprehensive strategy to address flooding. By taking action now, we can help minimize costs to taxpayers and better equip homeowners for the increased weather risks."
For more information about IBC's work on severe weather and flooding, visit www.ibc.ca.
About Insurance Bureau of Canada
Insurance Bureau of Canada (IBC) is the national industry association representing Canada's private home, auto and business insurers. Its member companies make up 90% of the property and casualty (P&C) insurance market in Canada. For more than 50 years, IBC has worked with governments across the country to help make affordable home, auto and business insurance available for all Canadians. IBC supports the vision of consumers and governments trusting, valuing and supporting the private P&C insurance industry. It champions key issues and helps educate consumers on how best to protect their homes, cars, businesses and properties.
P&C insurance touches the lives of nearly every Canadian and plays a critical role in keeping businesses safe and the Canadian economy strong. It employs more than 120,000 Canadians, pays $8.2 billion in taxes and has a total premium base of $49 billion.
For media releases and more information, visit IBC's Media Centre at www.ibc.ca. Follow IBC on Twitter @InsuranceBureau and @IBC_Atlantic or like us on Facebook. If you have a question about home, auto or business insurance, contact IBC's Consumer Information Centre at 1-844-2ask-IBC.
If you require more information, IBC spokespeople are available to discuss the details in this media release.
SOURCE Insurance Bureau of Canada
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