There is growing awareness that governments can transfer the financial risk of natural disasters to both insurance and capital markets, a Swiss Re expert observes.CatastropheProperty
In Asia, Africa, the United States and Britain, there are examples of national and sub-national governments considering ways to share their financial risks — from weather catastrophes to earthquakes — with the private sector, said Tobias Meier, a Washington, D.C.-based key account manager with Swiss Re’s public sector solutions team.
About 70% of economic losses from natural catastrophes around world are uninsured, Meier said Oct. 14 during Risks and Opportunities for the Capital Markets, a panel held during a virtual webinar hosted by CatIQ. Uninsured losses are growing faster than insured portion, Meier said.
“The question is, who absorbs these uninsured costs? The answer to that, frankly, is you and I as taxpayers.”
For uninsured natural catastrophe property losses, the public sector carries costs such as reconstruction and for emergency programs.