2009年-世界发展银行全球_Review_of_Public_and_Private_Disaster_Risk_Financing_Mechanisms_in_Central_Europe_35页_1mb

Summary of "Review of Public and Private Disaster Risk Financing Mechanisms in Central Europe"

Core Content

This document is a review of public and private disaster risk financing mechanisms in four Central European countries: the Czech Republic, Hungary, Poland, and Slovakia. It focuses on the financial preparedness of these countries in the face of natural disasters, particularly floods, and evaluates the role of government fiscal policies and private insurance markets in mitigating disaster-related financial impacts.

Main Natural Hazards in Central Europe

Central Europe is vulnerable to several natural hazards, including:

• Flood
• Landslide/mudslide/debris-flow
• Avalanche
• Wind-storm
• Weight of snow
• Fluctuations of extreme temperature

Among these, flood is the most significant natural hazard, responsible for the majority of economic and insured losses.

Key Findings

Economic and Insured Losses from Major Floods

• 1997 floods caused over EUR 5.6 billion in economic damages, with Poland (2.9 bn), Czech Republic (1.8 bn), and Slovakia (0.06 bn) being the most affected.
• 2002 floods resulted in total economic losses exceeding EUR 3 billion in Central Europe, with the Czech Republic alone suffering EUR 2.3 billion in losses.
• 2006 floods affected Hungary, Bulgaria, and Romania, with economic damages estimated at over EUR 0.5 billion.

Financial Preparedness

• Over 50% of homeowners in Central Europe are insured against natural disasters.
• Governments allocate significant budgetary resources for emergency preparedness and post-disaster aid and reconstruction.
• In the Czech Republic, over 49% of homeowners have catastrophe insurance, which is among the highest in the region.

Private Insurance Coverage

Catastrophe Insurance Penetration

Coverage Scope

• All Central European countries offer all-risks homeowners' coverage that includes natural perils such as flood, landslide, windstorm, avalanche, hail, and earthquake.
• FLEXA policies typically include natural perils as an integral part of coverage, and homeowners cannot opt out of these perils.
• Small businesses and SMEs can choose which perils to cover, leading to lower coverage rates (40-50%).

Insurance Terms and Conditions

• Insured limits are generally aligned with the sum insured under the FLEXA policy, but vary by country.
• Deductibles are typically low, rarely exceeding 2% of the sum insured or a few hundred euros.
• Premium rates range from 1 to 4 per mille (0.01% to 0.04%) and are influenced more by market competition than by actual risk levels.
• Insured limits in some countries remain artificially low due to reliance on historic property values.

Government Fiscal Mechanisms

• All countries have annual non-accruing emergency funds.
• Post-disaster assistance is provided in the form of grants and low-interest reconstruction loans.
• No means testing is required for emergency aid, though local discretion exists in Poland.
• Governments are still financially exposed to disaster losses, as they often cover both insured and uninsured victims.

Policy Recommendations

1. Reduce Government Fiscal Exposure

   • Governments should clearly separate public and private liabilities in disaster compensation.
   • Introduce private responsibility for losses caused by natural disasters, especially in housing reconstruction.

2. Increase Catastrophe Insurance Coverage

   • Raise public awareness of natural disaster risks.
   • Consider introducing standalone catastrophe insurance for homeowners and SMEs.
   • Develop a regional catastrophe insurance facility to leverage economies of scale and global reinsurance markets.

3. Enhance Risk Management Capabilities

   • Improve regulatory tools and specialized staff training for local insurance regulators.
   • Encourage risk modeling and reinsurance use to better manage catastrophe exposures.

Risk Management in the Insurance Sector

• Large insurance companies in Central Europe have advanced risk management skills.
• They actively monitor catastrophe risk accumulations and purchase excess of loss reinsurance.
• Reinsurance is centralized for large international groups, leading to better protection and lower premiums.
• Smaller insurers lack the capacity for sophisticated risk management but account for only 10-15% of the market.

Insurance Laws and Regulations

• Only the Czech Republic has specific regulations for catastrophe risk pricing, reserving, and reporting.
• The Czech Insurance Regulator requires companies to report 250-year PML estimates and reinsurance details.
• In Poland, catastrophe risk monitoring is part of Solvency II preparation, with plans to include it in stress testing.

Product Distribution Channels

• Insurers primarily use their own sales forces and tied agents.
• Bank-assurance is becoming more common in the region.

Conclusion

Central Europe has a relatively well-developed disaster risk financing system, with high levels of catastrophe insurance penetration and government support for emergency relief. However, there is room for improvement in separating public and private responsibilities, increasing coverage for vulnerable populations, and enhancing regulatory oversight to better manage disaster risks and reduce financial burdens on governments.