At last week’s World Economic Forum Summit in China, Swiss Re signed a Memorandum of Understanding (MoU) with the Chinese Dalian city administration to improve its comprehensive insurance programme for disaster resilience.
The programme includes catastrophic insurance solutions to protect against natural and man-made disasters such as fire and explosion.
Vice Mayor of Dalian, Hong Dengjin commented; “Innovative risk management solutions developed in partnership like this one, between the city of Dalian and Swiss Re, will allow us to put effective risk financing instruments in place in order to speed up recovery.
“This will benefit individuals, enterprise and the broader economy in our region. Overall it will strengthen our city’s fiscal and physical resilience.”
Jayne Plunkett, Regional President of Asia, Swiss Re, added; “We’re delighted at this important partnership with the City of Dalian, offering our deep risk management expertise and innovative insurance solutions as an effective tool to build concrete disaster resilience plans.
“More and more cities around the world recognise the win-win of understanding their risks and preparing for disaster in advance, rather than responding after the fact. It helps people, business and the economy.
“We hope more provinces in China and around the world will consider the advantages and follow suit.”
China has a strategic plan to develop urbanisation, but many of the highly developed zones are situated in areas highly exposed to natural disasters. Extreme weather events can threaten China’s booming economic development, which are seeing greater concentration of assets, people, and technology.
Chinese authorities and regulators are collaborating with re/insurers to pioneer new models of insurance tools to increase urban and rural resilience.
Swiss Re has previously launched two pilot schemes for resilience building in which local governments in rural and urban provinces are insured against natural disaster, instead of individuals and enterprises.
In October last year, Swiss Re sealed an agreement with the Chinese province of Guangdong to be the sole reinsurer for a parametric disaster insurance pilot providing $350m of protection against tropical cyclone and excess rainfall for seven prefectures in the region.
In addition to using re/insurance to build urban and rural disaster resilience, China has been pioneering harnessing re/insurance solutions to protect its clean energy revolution against deviations in weather patterns and energy turnout – and while these re/insurance and government led partnerships are in pilot project stages – they signal potential for reinsurance demand in China to rapidly increase in coming years.
