1. EC Flood action programme, Stakeholders' group meeting
AB 5154 (09/05)
European insurers and flood risk management
Roland NUSSBAUM
Chairman Natural Hazards Working Group
Property Committee
Comité Européen des Assurances (CEA)
EC Flood action programme, Stakeholders' group meeting
Brussels, 16 September 2005

2. Insurers and flood risk management
Context
Impact on insurance
Natural catastrophe cover schemes
European institution initiatives (examples)
Reinsurance and insurance initiatives
II. Experience-sharing on flood hazard mapping and zoning
III. CEA promoting the Public/Private Partnerships (PPPs ) necessary for the development of natural catastrophe insurance in Europe

3. Context - Impact on insurance
Many insurance classes affected:
Property.
Health/life.
Agricultural insurance (animals, crops).
Construction.
Professional risks (business interruption).
Transport (marine and aviation).
Even motor.
Insurability: important issue
Natural catastrophe losses:
Economic and Insured losses
See graphs on next 2 slides

4. Natural catastrophes from 1950 to 2003 in the world
More than 100 victims or more than 100 million US $ of losses

5. storms
floods
floods
subsidence
floods

6. ii. Penetration density of natcat extended coverage in European national insurance markets "facultative" in blue, "compulsory" in green intensity of colours according to penetration density

7. I. Context - European institution initiatives
European Climate Change Programme (ECCP)
March 2000
Approval of the Kyoto Protocol on climate change
Council Decision April 2002
Communication from the Commission “Winning the battle against global climate change”
February 2005
The European Union Solidarity Fund
Council Regulation Nov Proposal April 2005
EU Flood Action programme Communication on
flood risk management July 2004
INSPIRE Proposal for a directive July 2004

8. I. Context iv. Reinsurance and insurance initiatives
Reinsurers’ initiatives (1)
Promoting initiatives aimed at reducing the emission of greenhouse gases. Participation in worldwide projects (cooperation with IPCC - Intergovernmental Panel on Climate Change and UNEP - United Nations Environment Programme …).
Search for new products, new technical tools in order to estimate potential losses. Publication of communication papers.
Insurers’ initiatives linked to natural events
Involvement in climate change issues: debates on adaptation strategies at national level
Improving existing systems in terms of natural catastrophe cover
Experience-sharing on risk knowledge and prevention techniques:
Hazard mapping and zoning
Promoting PPPs necessary for the development of natural catastrophe insurance in Europe
(1) Swiss Re and Munich Re

9. II. Experience-sharing on flood hazard mapping and zoning
Criteria for review of market trends to handle this issue:
a) Density of flood insurance
b) Types of flood hazards involved
c) Market motivation for access to public cartography and zoning
d) Relevance and availability of hazard maps originating from the public authorities
e) Existence and progress of zoning/rating projects at the initiative of the markets
f) Existence of developments at the initiative of individual players
g) Forms of PPP in operation

10. Country profiles: How do insurance markets access flood hazard zoning data ? For what use ?

11. Market proprietary zoning tools Public zoning tools used by the marketDE CZ
Market proprietary zoning tools
Public zoning tools used by the market FR UK

12. of the Public/Private Partnerships (PPP) necessary for the development
III. CEA communication
for the promotion
of the Public/Private Partnerships (PPP)
necessary for the development
of natural catastrophe insurance
in Europe
CEA document AB (09/05) on table

13. CEA communication on PPP EXECUTIVE SUMMARY
3 main PPP  segments  or  components 
Political, with economic and social issues
Principles
Objectives
Policies and means
Financial: market forces, and PPP according to insurability conditions, to structure ex ante financing layers
Organisational and technical, with regulatory and/or normative and governance issues

14. CEA communication on PPP EXECUTIVE SUMMARY (contd)
CEA Action Plan:
To initiate, with help of Commission services, meetings with interested parties
To design various options for solutions for concerned Member States and markets to consider in their own decision-making process
To start thinking about how to address these issues at European cooperation level…

15. INVITATION TO PARTICIPATE: open discussions to be held soon
in Brussels between
Governmental experts, Commission services and Members of European Parliament
National Insurance Market Associations, NGOs and other stakeholders
on the promotion of Public/Private Partnerships
necessary for the development
of natural catastrophe insurance in Europe,
especially for very exposed Member or Accessing countries,
with low penetration of this type of insurance.

16. CEA papers that are availableon
Cover, reinsurance conditions and reserves
Flood prevention
Catastrophe claims management
Experience-sharing on flood risk mapping and zoning: volume I and II (Annexes)