The Philippines Parametric Catastrophe Risk Insurance Program Pilot

10.1596/36013 ◽  
2020 ◽  
Author(s):  
Keyword(s):  
The Philippines ◽  
Catastrophe Risk ◽  
Insurance Program ◽  
Risk Insurance

A feasibility study of a global risk pool scheme against tropical cyclones 

2021 ◽  
Author(s):  
Alessio Ciullo ◽  
Eric Strobl ◽  
Olivia Martius ◽  
David N. Bresch
Keyword(s):  
Tropical Cyclones ◽  
Extreme Value Analysis ◽  
Global Risk ◽  
Value Analysis ◽  
Administrative Costs ◽  
Catastrophe Risk ◽  
The Pacific ◽  
The Caribbean ◽  
Cross Country ◽  
Risk Insurance

<p>With increasing global economic damages due to weather-related events, insurance has even more become a valuable measure to share risks and increase resilience. Insurance solutions can be designed and implemented in various forms. Among these, cross-country insurance schemes emerged in the last years.</p><p>Natural catastrophe risk pools have the potential benefit of diversifying losses (thus lowering premiums) and of reducing administrative costs (as they are shared among countries). Currently, there are three catastrophe risk pools globally in place: the Caribbean Catastrophe Risk Insurance Facility (CCRIF), the African Risk Capacity (ARC), and the Pacific Catastrophe Risk Assessment and Financing Initiative (PCRAFI).</p><p>In the present work we aim to study the feasibility of establishing a global risk pool and, in particular, how countries might best be grouped together to achieve the greatest diversification. As a first step, this requires an assessment of global damages. We do this using the CLIMADA impact modeling platform and estimate worldwide damages from tropical cyclones. Then, we apply extreme value analysis and assess the diversification potential of various hypothetical pools based on measures from the systemic risk literature.</p>

Catastrophe risk, insurance and terrorism

2004 ◽  
Vol 33 (2) ◽  
pp. 135-173 ◽  
Author(s):  
Richard Ericson ◽  
Aaron Doyle
Keyword(s):  
Catastrophe Risk ◽  
Risk Insurance

scholarly journals Policy: Watch Challenges for Terrorism Risk Insurance in the United States

2004 ◽  
Vol 18 (4) ◽  
pp. 201-214 ◽  
Author(s):  
Howard Kunreuther ◽  
Erwann Michel-Kerjan
Keyword(s):  
Federal Government ◽  
Risk Sharing ◽  
Insurance Coverage ◽  
The United States ◽  
Terrorism Risk ◽  
Insurance Program ◽  
Before And After ◽  
Risk Insurance ◽  
Unites States ◽  
The U.S

This paper examines the role that insurance has played in dealing with terrorism before and after September 11, 2001, by focusing on the distinctive challenges associated with terrorism as a catastrophic risk. The Terrorism Risk Insurance Act of 2002 (TRIA) was passed by the U.S. Congress in November 2002, establishing a national terrorism insurance program that provides up to $100 billion commercial coverage with a specific but temporary risk-sharing arrangement between the federal government and insurers. TRIA's three-year term ends December 31, 2005, so Congress soon has to determine whether it should be renewed, whether an alternative terrorism insurance program should be substituted for it, or whether insurance coverage is left solely in the hands of the private sector. As input into this process, the paper examines several alternatives and scenarios, and discusses their potential to create a sustainable terrorism insurance program in the Unites States.

scholarly journals Feasibility questions about government-sponsored insurance for business interruption losses from pandemics

2020 ◽  
pp. 1-26
Author(s):  
Robert W. Klein ◽  
Harold Weston
Keyword(s):  
Crop Insurance ◽  
Private Insurance ◽  
Economic Losses ◽  
Preliminary Review ◽  
Working Paper ◽  
Strong Interest ◽  
Terrorism Risk ◽  
Insurance Program ◽  
Risk Insurance ◽  
Business Interruption

Widespread economic losses to many businesses due to COVID-19 business closures have led many plaintiffs’ attorneys to assert in lawsuits that business interruption (BI) insurance policies cover these losses, while insurers generally contend that their BI policies exclude coverage for a variety of reasons. We explain the basic coverage contentions below. Additionally, several states are considering measures that would retroactively establish coverage for pandemic-caused losses under BI policies. While the resolution of coverage disputes and the legality of retroactive coverage expansions in the courts is uncertain, clearly there is strong interest in making BI pandemic insurance available going forward. While a few insurers have offered BI pandemic coverage, no firms have purchased it (Lerner, 2020). Further, many insurers are reluctant to expand their BI policies to cover pandemic losses. Hence, there is strong interest in creating a federal government insurance program that would provide BI pandemic coverage. Currently, there are at least two formal proposals to establish such a program. One proposal is the Pandemic Risk Insurance Act of 2020 (PRIA), which was introduced in the U.S. Congress as H.R. 7011; PRIA would establish a Pandemic Risk Reinsurance Program (PRRP) modeled after the Terrorism Risk Reinsurance Program (TRRP) established by the Terrorism Risk Insurance Act (TRIA). Three industry trade associations also have proposed a Business Continuity Protection Program (BCPP) as an alternative to PRIA that is similar in some regard to the National Flood Insurance Program (NFIP). PRIA intends to create a public and private insurance program that would provide BI insurance for pandemics, with participating private insurers retaining 5% of losses above a deductible. We critique the program contemplated by PRIA and discuss the BCPP. Additionally, we consider a program concept of our own design that would also borrow from the NFIP (but would differ somewhat from the BCPP), as well as a program similar to the federal crop insurance program. We conclude that frameworks based on the NFIP or the federal crop insurance program would have several advantages over PRIA, which has a number of problems, but even these alternative frameworks would face many challenges. This policy brief provides a preliminary review of the PRIA and BCPP drafts, as well as other alternative frameworks, and draws from a longer working paper by the authors (Klein and Weston, 2020)

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