European Commission announces insurance investigation

The European Commission has announced a probe into the insurance industry’s ability to provide adequate cover against natural catastrophes, particularly flooding.

Michel Barnier, commissioner for internal market and services, announced yesterday at the European Parliament in Strasbourg that the commission would carry out an in-depth examination of insurance schemes covering national catastrophes, in particular flooding.

This announcement came in response to an oral question by Irish MEP, Seán Kelly, in which he said the market had been unable to provide “adequate cover" against flooding in certain member states.

Mr Kelly's question follows severe flooding in Ireland and the United Kingdom in November and December. It also comes shortly after the deaths of more than 50 people in violent floods caused by the Xynthia storm in France at the end of last month.

As part of its investigation, the commission will talk to member states and insurance experts to exchange examples of best practice and to establish the appropriate level for fixing priorities. This process will culminate in a conference that the commission will organize next year.

As special advisor to commission president José Manuel Barroso, Barnier presented a report proposing the creation of European civil protection force in May 2006.