Resilience or rebuild?

There are three statues in the Netherlands commemorating the story of the boy who put his finger in a dyke to plug a leaky hole. Stuck out there the whole night, his actions prevented the dyke from collapsing, saving the local town from flood. 

While there is no evidence the quick-thinking boy in the story really existed, there is plenty of evidence of the damages that flooding causes. Dutch history is punctuated by major floods. In 1953, a huge event killed almost 2000 people and led to authorities commissioning massive flood prevention measures, the Deltawerken. 

As the Netherlands well know, and as we discuss in this paper, there is considerable value in flood prevention. Some of the most effective are grey infrastructure with high benefit-cost-ratios (BCRs), including dykes, but they are also expensive to build and maintain. Alternatives include nature-based solutions, such as creating flood plains, building barrier islands, or wetland restoration that can be extremely effective if ample space is available. There are a number of early interventions which can reduce flood impacts, for example restricting development in areas prone to flood, and creating early warning systems to allow for evacuation in cases of severe high water.

However, prevention and protection measures require upfront investment and a proactive mindset for a future payback that will materialise as costs saved rather than monetary returns. At a superficial level, it may not be obvious which flood adaptation methods can best protect a community and its economic stability. Nonetheless, there is a way in which to capture and quantify the benefits of flood prevention measures, by use of BCRs. We demonstrate how BCRs can effectively be integrated into planning processes. 

When flood prevention measures are lacking or are inadequate, communities and public authorities are left to foot the bill for rebuilding, which can sometimes run to billions of dollars. That does not include potential societal or mental damage a flood can cause, or the lost potential of economic growth.

No measure can protect from flood entirely. This is the point at which insurance steps in, providing the coverage that supports fast financial recovery and resilience building.

The insights and experience of the re/insurance industry have also supported public authorities and asset owners in identifying flood exposure, and in designing optimal planning and risk management actions. Lastly, effective flood prevention will bring down the level of risk, which in turn influences the pricing of insurance premiums. 
The fictional Dutch boy clearly saw the need for immediate action, and we hope this publication helps to accelerate decision-making and action towards better flood management.