Swiss Re showcases innovations in public-private partnerships at the 2010 International Disaster Risk Conference

Earthquakes, droughts, floods, cyclones and other hazards impact over 200 million people every year. Climate change, combined with population growth, could put at risk many more. Most natural disasters cannot be prevented, but new forms of cooperation between the public and private sectors can help save lives and money by making local communities more resilient. Swiss Re's expertise in developing such partnerships took centre stage at this year's International Disaster and Risk Conference in Davos.

The massive earthquakes in Haiti and Chile earlier this year serve as tragic reminders of the devastation and suffering that a single large disaster can bring to a whole nation. But a closer comparison between the two events also reveals how a country's level of preparedness can make all the difference when a disaster strikes. Insurance solutions are an important element of successful risk management strategies because they protect against catastrophic losses and make societies more resourceful in the aftermath of a disaster.

Many of the most innovative risk transfer methods involve public-private partnerships. They offer a promising alternative to conventional insurance policies, especially in the developing world where financial resources are scarce and the effects of natural hazards severe. "For developing countries, index insurance and other parametric covers are particularly attractive because the administrative costs of these solutions are low and they pay out quick in the event of a disaster," says Swiss Re's Reto Schnarwiler, Head Public Sector, who attended this year's International Disaster Risk Conference in Davos.

Swiss Re has pioneered a number of such transactions using insurance and capital market instruments. Examples include parametric covers for hurricane and earthquake risk in Mexico and the Caribbean and weather-index solutions in Malawi. To showcase these transactions and share its expertise with a wider audience of public and private stakeholders attending the Davos event, Swiss Re participated in a lively panel discussion on the challenges of risk reduction and prevention, co-hosted with the Swiss Agency for Development and Cooperation (SDC/SECO).

To view the session, please visit the Conference website

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