Verisk Life Seminar event


Reinsurance News

Re/insurance essential in the management of rising, global flood risk: Guy Carpenter

18th May 2017 - Author: Luke Gallin

International reinsurance brokerage, Guy Carpenter, recently held a forum in Berlin, Germany that underlined the importance of utilising efficient and effective re/insurance capacity and solutions to improve flood risk management, one of the world’s most costly perils.

Flood risk is one of the world’s most advancing and evolving perils, driving high insurance industry losses year-on-year in both developed and emerging regions, with flood insurance penetration levels varying greatly from country to country.

A recent industry forum held by broker Guy Carpenter that included speakers from the Insurance Development Forum, The Geneva Association, the World Bank, Guy Carpenter, and elsewhere from the risk transfer industry, discussed the value re/insurance provides in regards to flood risk and effective risk management.

Speaking during the opening day of the two-day forum Peter Hearn, President and Chief Executive Officer (CEO) of Guy Carpenter, said; “The financial management of flood risks presents a significant policy challenge in many countries, requiring careful consideration of the relative effectiveness of various mechanisms to manage flood risk, from investment in risk prevention to the use of risk transfer schemes to protect against significant post-disaster costs.”

Flood, along with a host of other perils and socio-economic factors continues to contribute to global, and regional protection gaps (disparity between economic and insured losses post-event), and Hearn told attendees that a staggering 73% of natural catastrophe losses between 1970 and 2014 were not covered by insurance.

This protection gap is increasing in emerging and mature economies, where investment in critical infrastructure does not always keep pace with asset growth and accumulation. In response, the (re)insurance industry plays a crucial role in establishing efficient risk transfer strategies on behalf of public sector entities as part of their financial plan to manage disaster risk,” continued Hearn.

James Nash, President, International Division at Guy Carpenter, added; “We can help with the identification, assessment and mitigation of flood and other natural peril risks. We can promote integrated approaches to disaster and climate risk management to help mitigate the risk and, when a disaster does strike, enable swift recovery.

“We can develop effective national and multinational solutions for financing and transferring the cost of disaster risk from the public to the private sector. Finally, we can create innovative and affordable insurance products that can help protect individuals.”

Recent Reinsurance News

Getting your daily reinsurance news from Reinsurance News is a simple way to receive only the reinsurance industry news that matters, delivered directly to your email inbox.

  • Only email is mandatory, but the more you tell us about yourself the better we can serve you in future!
  • This field is for validation purposes and should be left unchanged.

By submitting the form you are giving your consent to be emailed by us.

Read previous article:
Reinsurance buying driven by expansion into new lines: A.M. Best

Europe's 20 largest cedants have been increasing their reinsurance purchasing as they grow their product offerings with new lines of...