Sovereign insurance – protecting the public purse from the growing burden of disasters
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Climate change, natural disasters and cyber attacks are some of the most acute risks keeping both citizen's and political leaders awake at night. Furthermore, the public expects their chosen representatives to take swift and effective action.
The fact is that disasters often hit the public budget twice: higher costs on the one hand and lower revenues on the other. The reconstruction of public infrastructure, emergency response costs, and support to help uninsured households return to normal lead to higher expenditures than planned for. Furthermore, damages to infrastructure preventing people from going about their business or causing tourism to decline, can lead to a drop in GDP and associated tax revenues.
The message is loud and clear. It's time for governments at all levels of administration – whether at national, regional or municipal – to become more active in terms of managing their disaster risk. Decision makers need to take bolder steps to prepare their societies better, and to become more financially resilient, in order to reduce the impacts of unforeseen events. Swiss Re invites you to engage in a dialogue to explore how insurance can complement and strengthen your toolbox of existing fiscal instruments.
For more information, please see the our latest publication "Sovereign insurance - Creating financial resilience against the growing burden of disasters", or contact our team directly. We will be happy to help!