“We, mayors of small towns in France, call on the government to act! »

2023-11-20 06:00:14

Unsuccessful public insurance markets, rising premiums, unilateral termination of contracts… The prospect of municipalities having to insure themselves (self-insurance) hangs over the already constrained budgets of small towns. The withdrawal of insurers no longer affects only the municipalities most exposed to environmental risks, but also those whose loss rates are under control. We, mayors of small towns in France, express our concerns and call on the government to act.

What initially seemed like a localized phenomenon turns out to be a global process. Many local players, from small towns to large intermunicipalities, are bearing the brunt of the withdrawal of insurers, who are deserting an unprofitable market.

Crisis due to Covid-19 has been there, as has urban violence. The latter generated 730 million euros in claims, according to France Assureurs, including 200 million euros solely for damage suffered by communities: destruction of public buildings, damage to street furniture, etc. But it is above all the increase in climate risks which has led insurers to terminate numerous contracts in advance.

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This so-called “unilateral termination” practice of insurers is perfectly legal with regard to the insurance code, which provides, in article L. 113-4, that they can “denounce the contract” or “propose a new premium amount” in the event of an increase in risk.

The Council of State also confirmed this possibility in a judgment of July 12, provided however that it allows the insured public entity to enter into a new contract within a period which cannot exceed twelve months. If the highest French administrative court justified its judgment by the need to ensure the continuity of the public service, it also specified that the termination cannot be called into question in the event of an unsuccessful procedure.

Territorial cohesion at stake

Mayors of small towns in France, we therefore suffer the double punishment. On the one hand, it is we who find ourselves on the front line facing the various changes (social, economic and environmental) which affect society (increase in incivility, normalization of natural disasters, emergence of cyber-risk, etc.), on the other, it is up to us to accomplish, with ever more limited resources, ever more demanding missions of general interest. And we would also have to repair the damage we have suffered ourselves? And what about the damage caused to others? We find this unfair given our financial means.

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