Desjardins offers free flood coverage to eligible clients in low-risk areas

One Canadian insurer is not waiting for consumer take-up of its flood insurance coverage — it is automatically tacking the endorsement onto the policies of eligible clients who live in low-risk areas.

Desjardins General Insurance Group (DGIG) told Canadian Underwriter that its flood coverage, Endorsement 16d, is automatically bonded to an eligible client’s policy. “We have reviewed our clients’ profiles that can benefit from this endorsement and added it to their policies automatically and free of charge,” Desjardins spokesman John Bordignon said in an interview. “We believe we have taken proactive steps to help them deal with the added risks of increasing water-related claims events.”

Asked how “low-risk” was defined, Bordignon said that the addition of flood protection is based on certain criteria such as the overall risk of flooding, ground water seepage, and sewer back-up. The following elements are taken into consideration when identifying flood risk:

• Topography of the land surrounding the residence (e.g. elevation and distance from a body of water)
• Type of body of water and characteristics (e.g. river, lake, ocean)
• Precipitation and historical data in the area (e.g. snowfall, rainfall).

The coverage offers protection against sudden and accidental damage to insured property caused by water that reaches the premises and that originates from the rising or overflow of body of water (stream, river, pond, lake, etc.) or from a dam break, as well as the damage caused by the impact of water-borne objects that reach the premises (including ice).

For the remainder of clients who don’t have the coverage, one in five choose to add it to their policy when it’s offered, Desjardins added in a press release.