Greece is characterized by its high seismic exposure. It is estimated that the economic loss to the residential stock of a 1-in-200 year event is likely to be greater than 22 billion Euros while for a shorter return period 1-in-5 year it is likely to be 1.3 billion Euros.

This potential loss severity was estimated by employing four different renowned catastrophe models and by developing a valuable and unique data bank of the residential stock in the country. The severity of losses underscores the urgent need for establishing a National Earthquake Insurance

Program that will replace the ex post disaster relief by the State when an earthquake occurs. It is proposed that earthquake coverage up to a maximum amount should be provided on a compulsory basis to all homeowners at affordable but risk-based premiums which consider location and construction period. Transfer of earthquake risk to international reinsurers safeguards high capacity and success of the program in the long run.

The program should provide insurance to all home owners, without excluding old houses, at a cost much lower than the private market. Expected claims response will increase penetration which will lead in better reinsurance terms or even expansion of the program to cover other catastrophic risks. A national risk management approach will prove to be beneficial for the Greek society overall."

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GREECE: Proposal for a national earthquake insurance program