Here we review GC Capital Ideas posts on how the private sector is exploring the development of innovative solutions for public sector risk exposures.
Partnerships: The Way To Public Sector Risk Financing: The impact that catastrophic loss can have on the fiscal position and tax base of government entities across the globe is significant. Impacted areas can take decades to recover when economic recovery is limited. Approximately 73 percent or USD 2.7 trillion of natural catastrophe losses globally between 1970 and 2014 were uninsured. The creation of private sector pre-financing options will not only relieve the burden on taxpayers and in turn, public finances, but will migrate the management of these catastrophes to insurance and reinsurance companies where claims handling and risk management is core to their operations. This allows local economies to come back on line more quickly.
Private Market Driven Innovations/Solutions: The 2015 Global Insurance Forum addressed the topic “Filling the Protection Gap.” During the conference, key speakers noted the growing divide between the economic losses societies are facing and the role of the insurance industry. Many (re)insurance leaders believe the industry can play a significant role in a rapidly changing global risk landscape with pre-loss financing solutions designed to spread risk, relieve the burden on public finances and improve the resiliency of communities.