A survivor of catastrophic British Columbia floods last year is warning others to check their insurance policies after she said she received a payout of just $30,000 when her home, valued at $414,000, was destroyed.
Pam Velt, whose house collapsed into the Nicola River last November, said she and her husband, Paulus, believed they were fully insured.
“We thought we were covered,” she said. “I finally realized that we no longer have a home. And everything we worked so hard for is gone.”
The Velts had just begun their retirement on the rural property along Highway 8 west of Merritt, British Columbia, and planned to leave it to their son, who also lived with them. They are now housed in a 12ft trailer with the support of the Canadian Red Cross.
Despite paying extra for overland flood insurance, which covers damage from heavy rains and overflowing rivers, Velt said they were shocked by the amount of the payment and are contesting it.
A copy of the Velts’ insurance coverage shows their primary policy includes a total of $674,050 in property coverage, including $313,500 for their home, and other coverage for additional structures, personal property and loss. of use. Under additional and optional coverage, the amount of overland flood insurance is $30,000.
Their insurer, Wawanesa Mutual Insurance Company, said that in the interest of the privacy of its policyholders, it could not comment on details of a claim or details of a dispute.
Policyholders who disagree with company decisions have several options, including contacting the General Insurance Mediation Service and the Financial Consumer Agency of Canada, he said. .
Prior to 2015, the only financial compensation available for overland flood damage to homes in Canada was through disaster financial assistance programs provided by the federal and provincial governments, the Wawanesa spokesperson said. , Brad Hartle.
The company is one of 30 companies across Canada that now offer some level of flood coverage.
“Some homes face a greater risk of surface flooding than others and this is reflected in the coverage available and the price charged,” he said.
Extreme weather insurance costs have skyrocketed
Rob de Pruis, national director of consumer and industry relations at the Insurance Bureau of Canada, said extreme weather insurance costs have skyrocketed over the past decade. The national average is $2.1 billion per year, up from $422 million between 1983 and 2008.
“The insurance industry has seen an increase in the frequency and severity of severe weather events, and we’ve been sounding the alarm for years,” he said.
The November floods were the costliest disaster in British Columbia’s history, with insured costs estimated at $515 million in January. This figure is likely to increase and does not include uninsured costs, according to the bureau.
The best estimate based on anecdotal evidence is that about 30% of properties in high-impact areas had some level of overland flood cover, de Pruis said, but there is no official tally.
About 800,000 properties in high-risk areas across Canada remain ineligible for coverage, he said.
The Insurance Bureau of Canada is working with the federal government to develop a flood map and flood plan to increase coverage eligibility for those currently uninsured, he said.
For now, it is up to each company to determine the coverage they will offer in risky areas like floodplains and along rivers.
Pricing is difficult because some risks are so high that pricing the cover appropriately would be unaffordable, de Pruis said.
“As the risk begins to increase, the cost increases and coverage limits may be reduced,” he said.
In a news release this week, the British Columbia government urged British Columbians to prepare for disasters by purchasing home insurance.
However, he notes that flood insurance can be difficult to find.
“While residential flood insurance may be limited in high-risk areas, insurance representatives can help determine if residential flood insurance or sewer backup coverage is available for your property” , the government said.
Months after the flood, Velt said she and her husband were still making mortgage payments on the missing home and also paying for insurance to protect themselves from liability if someone were injured on the property.
The last time Velt was in the house, she was trying to force open the door to save her pets. She wears rubber boots and donated hoodies, but as the seasons change, Velt said she realizes she needs a whole new summer wardrobe.
“When you leave with what’s on your back, you have nothing. Summer is coming now. I tried to explain to the Red Cross, we don’t have shorts,” said she declared.
The BC government has said flood victims are eligible for up to $300,000 in disaster relief and Velt said she hopes that will come to fruition soon.
For now, she said she is grateful for the support of her friends and family.
“We are in limbo,” she said.