Just a year ago, Nova Scotia residents faced devastating flash flooding that resulted in four fatalities and caused extensive damage to a region still recovering from wildfires. This anniversary serves as a sobering reminder of the additional efforts needed to better protect Canadians from flooding.
On July 21, 2023, an atmospheric river led to severe flooding in parts of Nova Scotia, including Halifax, East Hants, West Hants, and Lunenburg and Queens. In the hardest-hit areas, this extreme weather event produced more than 250 mm of rain – over three months’ worth – in less than 24 hours, leading to a provincial state of emergency, significant damage to infrastructure, homes and businesses, and tragic loss of life. In total, the flooding caused over $257 million in insured damage, according to estimates from Catastrophe Indices and Quantification Inc.
“Progress on the rebuild and recovery process following last year's destructive flash flooding has been encouraging, but we must never forget that this event resulted in the tragic loss of life,” said Amanda Dean, Vice-President, Ontario and Atlantic, Insurance Bureau of Canada (IBC). “Sadly, the province experienced yet another deadly flash flood event just last week. Homes, cars and businesses can be replaced and fixed, but our thoughts continue to be with those families who have lost loved ones.”
Residents affected by flooding in Nova Scotia, who have questions about their auto, home or business insurance, are encouraged to contact their insurance representative or call IBC’s Consumer Information Centre at 1-844-2ask-IBC.
“The availability of overland flood insurance remains limited in high-risk, flood-prone areas. Unfortunately, as an estimated 10% of Canadian households cannot access affordable flood insurance, last year’s flooding had devastating financial consequences for some,” said Craig Stewart, Vice-President of Climate Change and Federal Issues, IBC. “Although insurers paid out more than a quarter of a billion dollars in claims for this extreme weather event, we expect total losses were far higher due to the number of uninsured properties, as well as damage to public infrastructure.”
To ensure the availability and affordability of flood insurance in high-risk areas, IBC has been working constructively with Canada’s federal government since 2017 to design the proposed low-cost National Flood Insurance Program for the country’s 1.5 million homeowners who cannot obtain affordable insurance. While IBC and its member insurers are encouraged by the timelines for establishing this program in partnership with the industry, as announced in Budget 2024, the federal government has not yet committed the necessary resources to make the program a reality.
“Current government disaster relief programs are taxpayer-funded subsidies for those who live in high-risk areas. These programs can be ad hoc and unpredictable. Funding can take up to two years to reach affected homeowners and is usually capped,” added Stewart. “Unless the federal government commits the necessary resources this fall to stand up the National Flood Insurance Program while provinces and territories commit to mitigating flood risk, insurers will not be able to support the program before the next federal election. Just last week, the remnants of Hurricane Beryl caused deadly flooding to the same areas of Nova Scotia that were impacted by last year’s flash flood. This is another clear reason to move forward with Canada’s National Flood Insurance Program. This is the single, most important step the government can take to better protect homeowners from the financial risks of climate change.”
Like other Atlantic provinces, Nova Scotia has historically faced windstorms and water-related risks such as flooding. Overall, the last two years have been Nova Scotia’s worst for catastrophic insured losses on record, with a total of $581 million for 2022 and a total of $610.9 million for 2023. On a per capita basis, Nova Scotia had the highest amount of insured losses out of any province in 2023 and the second highest in 2022.
In the coming days, IBC will be releasing a report to provide a transparent, public review of the property and casualty (P&C) insurance industry’s claims response and the factors impacting the claims landscape after last year’s severe weather events in Nova Scotia. The report will also offer recommendations on how governments, regulators and the P&C insurance industry can work together to improve the claims process.
