German re/insurers are in the process of drafting plans for a multi-billion euro fund to better prepare the country for dealing with future pandemics, according to reports from Der Spiegel.
The fund would function as a public-private system between the government and the re/insurance industry, with existing catastrophe funds used as a model.
The idea is that it would be financed by contributions from insurers and businesses that could be impacted by a pandemic, as well as through catastrophe bonds and government funds.
Der Spiegel reported that a working group of major companies has already put together a discussion paper that estimates the fund needs a volume of more than €10 billion.
If approved, the German fund would join the recently approved reinsurance backstop for trade credit insurers in the UK, as well as possible backstop plans that are underway in France.
The US is also considering a similar model with the Pandemic Risk Insurance Act of 2020 (PRIA), which was introduced Rep. Maloney alongside various stakeholders last month.
Swiss Re and the Federation of European Risk Management Associations (FERMA) are among those to advocate for the use of such public-private partnerships, although SCOR CEO Denis Kessler has cautioned against the introduction of pandemic schemes.
