Buschmann remains steadfast in his opposition to mandatory natural disaster insurance coverage.
Disaster floods hitting Bavaria and Baden-Württemberg recently sparked a heated debate about mandatory insurance. The concerned states emphasized their request for it in the Bundesrat late last week, with a meeting with Federal Chancellor Olaf Scholz (SPD) set for Thursday.
Saarland's Prime Minister Rehlinger expressed his thoughts to the newspapers of Redaktionsnetzwerk Deutschland on Wednesday: "Since the federal government hasn't taken action, the states are compensating damages using tax money. That can't go on." He implied that the French model demonstrates "a mandatory insurance could also be affordable and without the government meddling constantly."
Advocates for a mandatory insurance include numerous parts of the traffic light coalition, with the FDP expressing opposition. Buschmann spoke about this: "We now know that the promise cannot be kept that a mandatory insurance would lead to lower contributions for everyone." He explained that a premium is a combination of the risk of a building sustaining damage and the costs associated with that damage. "This premium wouldn't change if the building was insured on both sides."
Buschmann cautioned of potential challenging outcomes, stating, "A mandatory insurance would be accompanied by very difficult consequences." He raised concerns about regions in Germany where insurance premiums are so high that "we could be forcing people out of their parents' homes who can no longer afford the premiums." In such regions, the extra costs from a mandatory insurance might be so high that even renters and tenants could no longer afford to live there.
On the contrary, average premiums would only be feasible if there was a state-owned monopoly insurer and politics constructed a complex risk structure adjustment, according to the Justice Minister. Therefore, he favors an offer obligation: All individuals seeking an elemental damage insurance should receive one, confirmed Buschmann. People with existing contracts would be offered to upgrade their insurance, while new contracts would include elemental damage insurance but make it optional.
The President of the German Insurance Association (GDV), Norbert Rollinger, welcomed the Minister's proposal. "We ourselves would like more customers to be protected against the consequences of natural disasters," he shared with the "Augsburger Allgemeine" on Thursday. "But everyone should be able to decide for themselves." GDV assures that insurance companies will offer insurance to all property owners along the rivers and creeks that overflowed. "That is the core of the offer obligation."
Rollinger ensured that the premiums would stay within an affordable range: "We are talking about the low four-digit range, but with a self-retention." He clarified that the height of the contributions depends on the risk, as it does with other insurances. He added that for over 98% of the houses in Germany, elemental damage insurance is already manageable.
Read also:
- Buschmann's stance on mandatory natural disaster insurance has remained unwavering despite the recent floods affecting Bavaria and Baden-Württemberg.
- The debate about compulsory insurance intensified in the Bundesrat, with several states advocating for it, including Baden-Württemberg, which was severely impacted by natural hazards.
- Rehlinger, the Prime Minister of Saarland, argued that the federal government's inaction forces states to compensate damage-related expenses using tax money, suggesting the French model as an affordable and non-interfering alternative.
- Among the supporters of mandatory insurance, the SPD and various parts of the traffic light coalition are notable, but the FDP, represented by Buschmann, expressed opposition to the idea.
- Olaf Scholz, the German Chancellor, is scheduled to meet with the concerned states to discuss this contentious issue, as the traffic light coalition forms a significant part of the German political landscape.
- Anke Rehlinger suggested that a mandatory insurance system could be implemented in a way that doesn't increase premiums for property owners, sparking interest from the German Insurance Association (GDV).
- Rollinger, the President of GDV, not only welcomed the proposal to allow an offer obligation but also assured that insurers would continue offering insurance to affected property owners, intending to keep premiums within the affordable range.
- Regions with high insurance premiums, like some parts of Bavaria, face challenges, according to Buschmann, as a compulsory insurance could force residents to pay extra costs they can't afford, leading to potential displacement due to unaffordable housing.
