RVS Live: Reinsurers' consensus: the property insurance gap is a real concern and needs to be closed 11 September 2017

11 September 2017 — Mihaela CIRCU
Most reinsurers gathered in Monte Carlo have expressed their concern with the lack of proper insurance protection of properties around the world, especially that the latest events have once again shown that climate change is a real challenge.

Christian MUMENTHALER, SWISS Re's CEO said the current protection gap globally for natural catastrophe and weather protection stands at USD 180 billion and growing. In a similar note, MUNICH Re has advocate in favor of the public-private partnerships, as the British Flood Re, the North American National Flood Insurance Program or other European similar entities which "offer policyholders more insurance coverage options, promote flood protection, and also reinforce the basis for improved risk management."

In fact, as Guy Carpenter's international President James NASH has stated, "flood is the new super peril", the reinsurance industry being expected to continue cooperate with governments to find solutions to such mega-cat events, as the recent hurricanes Harvey and Irma or the floods in India.

Yet, as several industry representatives have underlined, such successful PPPs are for the time being rather characteristic to the developed market economies, which leaves large territories of the world witha very poor insurance protection, thus with a very poor resilience in face of the Nat Cat risks. "There are significant pools of capital seeking risk peril and there has never been a better time to transfer risk into the reinsurance markets," James NASH said, meaning that it is a good moment for all interested parties to take action and consider solutions for a greater risk transfer.

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