Vietnam's flood challenge

With several of Vietnam's big urban centres either on major waterways or close to the coast, flood risk looms large both socially and economically. Our new publication looks at the problem and proposes ways of narrowing the protection gap.

The authors of Swiss Re's recent study, Flood focus: Vietnam, say that the economic damage caused by flooding typically dwarfs insured losses. A case in point was Typhoon Mirinae in 2009 which triggered economic and insured losses of around USD 280 million and USD 10 million respectively. The publication goes on to point out that this massive shortfall looks set to widen further given the expected economic growth in the region. The urban centres identified as the most exposed to flood hazard are Ho Chi Minh City, Hanoi and Hai Phong. These cities are not only major population centres but also generate 50% of Vietnam's GDP.

Ways to tackle under-insurance

The problem of under-insurance, the publication says, can be addressed by introducing innovative insurance solutions, also geared towards end users. Swiss Re has traditionally worked with corporations, governments, and regional development banks to develop natural catastrophe solutions that benefit thousands of people around the world. For example, Swiss Re was one of the contributing partners in the first sovereign catastrophic insurance solutions in Asia Pacific.

Superior data and regular dialogue

Swiss Re has also been collaborating with Asia Development Bank (ADB) to develop disaster risk financing solutions for cities in Vietnam, Indonesia and Philippines. Close dialogue between insureds, insurers and local authorities to make risk management more effective and efficient is also vital, the publication's authors say. Combined with better hazard and exposure information, such an exchange would increase transparency and help to identify effective physical flood mitigation measures and appropriate insurance solutions for the region.

Download Flood focus: Vietnam.

Published 29 June 2015

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