Does Compulsory Insurance for Natural Disasters Help?

The dramatic flood damage in the German states of Rhineland-Palatinate, North Rhine-Westphalia, and to some extent also in Bavaria and Saxony has revived the debate about compulsory insurance for damage from natural disasters. Currently, there is no obligation for homeowners in Germany to insure themselves against flood damage. About 46 percent of all buildings are insured voluntarily, but there are large differences within Germany. In Baden-Württemberg, 94 percent have insurance, while the figure in the particularly hard-hit Rhineland-Palatinate is currently 37 percent, and in Bremen, only 23 percent.