Canadian Underwriter

What brokers can do more of to help their clients protect against flood risk

August 27, 2020   by David Gambrill

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Canadians understand that flood damage has increased, but they don’t necessarily know to protect their homes against it, according to joint research conducted by RSA Canada and World Wildlife Fund (WWF) Canada.

The research suggests an opportunity for Canadian P&C brokers to provide more advice to clients about how to protect their homes against flood risk.

Nearly three-in-four (74%)of Canadians agree that flooding in Canada has increased, according to a study of 1,726 Canadian adults jointly commissioned by RSA Canada and WWF, conducted by Mary/Blue between Aug. 8 and Aug. 26, 2019. Thirty-one per cent of Canadians are worried they will be affected by floods within 12 months.

“So that’s good news, that shows awareness that the flood [risk] is increasing,” said Donna Ince, senior vice president of personal lines at RSA Canada. She was commenting on the survey results during the Aug. 19 Insurance Institute of Canada webinar, Climate Risk Leadership: Exploring Climate Risk Leadership in the time of COVID-19.

“There is a pretty good understanding of what the risk of flood is,” Ince continued, “but unfortunately, despite growing concerns, flood knowledge on mitigation or protection among consumers remains pretty low. Our study uncovered that about half of those surveyed, 47%, actually don’t know how to protect their home. So, while they might be a bit worried about having a flood, or they know that a flood is a problem in Canada, they actually don’t know how to protect their home.”

Ince said the insights generated by the survey results presented a good opportunity for RSA Canada to work with their WWF partners on flood education for consumers. She also pointed to the need for an educated broker force to offer their clients advice about flood risk and on how to protect their homes.

“We really feel that [broker education] is really important,” Ince said. “Obviously, being an intermediated insurer, we really look to our brokers to help support the education of our policyholders, whether it’s sharing knowledge on how to protect their homes and businesses, or do they talk to [their clients], when they are going to buy a home, about making sure they are not buying a home that’s on a floodplain.”

RSA’s survey numbers show that 93% of Canadians don’t think they live in a floodplain. More than a quarter (29%) of Canadians think floods only occur in low-lying areas, while 19% think floods happen only near bodies of water. Another 19% think floods happen only after a heavy rainfall. Under a third (27%) of Canadians don’t know that paved surfaces lead to water runoff.

On all of these points and more, brokers have an opportunity to educate their clients about flood risk.

And customers appear to be receptive to hear more from their brokers about ways to protect their homes against damage, according to results of a recent Trusted Advisor survey undertaken by Canadian Underwriter in March 2020. The survey canvassed the opinions of more than 600 home and auto insurance policyholders about the service they were receiving from their brokers.

One question in the survey asked: “What topics would you want your broker to talk to you about more?”

Fully 66% of personal lines customers in the survey said they wished to hear more from the brokers about “ways to reduce my insurance premiums.”

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