Saarland floods trigger debate about mandatory natural hazard insurance in Germany

Representatives of Germany’s states of Germany will discuss the idea of introducing mandatory insurance for homes for natural hazards with chancellor Olaf Scholz on 20 June, a spokesperson for the federal justice ministry told newspaper Augsburger Allgemeine Zeitung. Natural hazard insurance would cover damage caused by events like floods, storms and landslides, against which only 54 percent of households are currently insured. The justice ministry, led by the Free Democrats (FDP), is sceptical about a nationwide introduction, with the spokesperson saying that it wouldn’t solve the problem of risk, and highlighting cost as an issue. Estimates from industry show that natural hazard insurance for a single family home can cost from 100 to 2,000 euros annually.

The discussion comes on the back of recent floods in the western states Saarland and Rheinland-Pfalz, where only 47 and 46 percent of households are insured against this kind of events, respectively. After the major flood disaster in the western Ahr Valley in the summer of 2021, the conference of the country’s state premiers had called for the nationwide introduction of mandatory natural hazard insurance. The insurance industry already in the past has warned that climate change is increasing the risk of natural hazards, and that Germany should stop building homes in areas threatened by flooding. Earlier this year, a climatologist suggested that homes destroyed by floods shouldn’t be rebuilt.