The Association of German Public Insurers (VöV) welcomes the opportunity to comment on the European Commission’s consultation regarding the Housing Simplification Package. The public insurers are the second-largest group in the German primary insurance market, have strong regional roots and are the market leader in residential building insurance. They are therefore directly affected by the framework conditions for new construction, renovation and the long-term insurability of residential property. The Association supports the objective of removing unnecessary regulatory and administrative burdens. At the same time, simplification, prevention, and climate resilience must be considered simultaneously to ensure that short-term cost reductions do not result in higher losses and insurance costs in the long term.
The Association considers the European initiatives on housing to be closely linked to the emerging integrated European framework for climate resilience. Measures to improve the affordability and availability of housing should therefore consistently be viewed in conjunction with the objectives of climate adaptation and the long-term resilience of the building stock. This applies in particular to planning, site selection, construction standards, renovation and reconstruction. Further positions of the Association on climate resilience, prevention, risk transparency and insurability can be found in our detailed response to the European Commission’s consultation on the European framework for climate resilience. With regard to the specific questions of the consultation, the public insurers provide the following comments and refer to the feedback from the German Insurance Association (GDV) for further aspects.
The Association of German Public Insurers welcomes the European Commission’s objective of removing unnecessary regulatory and administrative burdens on the construction and renovation of housing. Faster approval procedures, better coordination between administrative levels and the removal of overlapping regulation can help reduce costs and increase the supply of housing. Simplification should follow a clear guiding principle: less bureaucracy and lower procedural costs without compromising the protective effect required for safety, prevention and climate resilience. Lower construction or renovation costs in the short term must not result in higher loss, repair and insurance costs in the long term.
Climate Resilience Is Part of Affordability
The consequences of climate change and increasing natural hazards such as heavy rainfall, flooding, storms, hail and heat have a direct impact on buildings and their occupants. Rising claim frequency and loss severity also affect risk assessment, insurance capacity and premiums in the long term. From our perspective, the principle is therefore clear: resilience is affordability. The affordability of housing must not be assessed solely on the basis of initial construction or renovation costs. Instead, the costs over the entire life cycle of a building are crucial. Prevention measures may require additional upfront investment. However, investments in risk-aware site selection, heavy rainfall and flood prevention, resilient construction methods or property-specific protective measures can prevent significant future losses and consequential costs. At the same time, they help keep buildings insurable in the long term and enable affordable insurance coverage. Where necessary prevention measures require significant additional upfront investment, existing European and national funding and financing instruments should be specifically made available for measures that strengthen resilience.
Bringing Prevention and Simplification Together
Insurance can cover residual risks, but it cannot replace prevention and risk reduction. A sustainable strategy for affordable housing must therefore begin with risk reduction. Natural hazard information should be incorporated into planning, site selection and approval procedures at an early stage. New exposure in particularly vulnerable areas should be avoided wherever possible or limited through appropriate protective measures. Renovation and reconstruction should likewise be used as opportunities to strengthen the resilience of buildings against future extreme weather events. Prevention and simplification do not have to be contradictory. Digital and streamlined approval procedures, together with better access to reliable natural hazard data, can both accelerate processes and facilitate risk-appropriate decision-making. The public insurers therefore support a critical review of existing construction and administrative requirements. Unnecessary duplication of regulation, excessively detailed requirements and legal uncertainty should be reduced. By contrast, risk-relevant requirements that demonstrably prevent or reduce losses should not be treated indiscriminately as regulatory cost drivers. New requirements in the housing sector should also be designed coherently with the emerging integrated European framework for climate resilience and avoid duplicative requirements.
Conclusions
- The public insurers support the objective of making housing construction and renovation in Europe simpler, faster and more cost-efficient. However, affordable housing must remain safe, resilient and insurable in the long term.
- Prevention may require additional upfront investment. However, it is essential to keeping housing affordable, resilient and insurable over its entire life cycle.
- Insurance is part of comprehensive risk management. It can cover residual risks, but it cannot replace prevention and climate adaptation.
The Association of German Public Insurers looks forward to further discussions regarding the Housing Simplification Package and remains at your disposal for any follow-up questions.
