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devastated much of the area surrounding Abbotsford, B.C., in November, 2021, Hester Mulder’s fields are bright green, the scent of fertilizer is strong in the air, and farm equipment busily rumbles around.
For years, low borrowing costs softened the financial hit of natural disasters to Canadians’ household balance sheets, says John Haralovich, a licensed insolvency trustee. The senior vice-president at MNP is based in the Ottawa-Gatineau region, which went through two so-called one-in-100-year floods in 2017 and 2019.
In the meantime, the couple and one of their children are living in a one-bedroom suite in a parking shed on their farm. Another child lives in an RV parked inside the shed. They were able to hastily build a comfortable suite in an existing shed that they rent out for parking space and storage, but it’s cramped.
“I will never see a clear title on this land,” he said of the new property, a ranch nestled on a hill in Yale, B.C. In regions that are prone to flooding, insurance premiums can reach $10,000 to $15,000 a year for flood coverage alone, according to the report.it is considering an insurance program that would provide affordable coverage to high-risk households. But the budget did not say when Ottawa expects such a plan to be running.
Graham Zillwood walks around his former property in Hope, B.C., where his home was destroyed in the province's 2021 floods. A staircase used to extend to the river.Mr. Zillwood said he received $30,000 from his insurance, which reflected his policy’s coverage limit for overland flooding, and around $100,000 in financial aid, an amount he is challenging in an appeal. With no land on which to rebuild, the total payout amounted to much less than what he would need to buy a new home, he said.
Without government help, Mr. Perera, who didn’t have flood insurance, turned to his line of credit to pay for much of the rebuilding. While the Mennonite Disaster Service, a faith-based organization that assists survivors of natural calamities, put in new flooring and drywall for free, he still had to pay out of pocket for anything from plumbing and electrical work to new doors and appliances. To date, his balance on the line of credit has grown to around $62,000.
The government’s estimate is based on the fact that the flood had only reached the first floor of her home. But Ms. Brechin said the damage has been so severe she will have to rebuild the whole house, which her insurance valued at $364,000 for the structure. There was no shopping around, no inquiring at the bank about borrowing against the home or through the mortgage, a kind of debt that typically carries lower rates. Instead, many ran up their credit card balances or signed up for high-interest loans in an effort to get quick access to cash, said Mr. de Boer, who wasn’t directly affected by the flood but participated in the relief efforts through his local church in Abbotsford, the largest urban centre hit by the disaster.
Of the top 10 years in which extreme weather caused the highest insured losses since 1983, nine date after 2010, according to the Insurance Bureau of Canada. In 2022 alone, the tally from insured damages reached $3.1-billion – the third-highest on record – because of what an IBC report calls “disasters from nearly every part of the country.”
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