Suchergebnisse

On August 25 the huge oak tree in front of our house dropped a large branch during a microburst from a storm. Later that night, it rained and rained and rained. The tree punctured our roof in multiple places, crashed through a bedroom window, and even managed to pierce the internal ceiling of two upstairs rooms. The rainwater eventually found its way to our lower floor, which we noticed by the multiple drips and small puddles from the living room ceiling. A few days later huge hunks of plaster fell in that space. An old crack in our basement foundation also seemed to expand and allowed water into our storage areas for the first time in 32+ years of living in the house. It's been a trying five weeks:
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Cover Page -- Title Page -- Copyright Page -- Contents -- Foreword -- Introduction: The Destructive Forces of Nature -- Chapter 1: Earthquakes and Tsunamis -- Chapter 2: Hurricanes and Floods -- Chapter 3: Thunderstorms and Tornadoes -- Chapter 4: Fire and Drought -- Chapter 5: Volcanoes, Landslides, and Avalanches -- Chapter 6: Natural Disaster Response in a Fast-Changing World -- Notes -- Discussion Questions -- Organizations to Contact -- For More Information -- Index -- Picture Credits -- About the Author -- Back Cover

It is widely recognized that market failure prevents efficient risk sharing in natural disaster insurance, leading to several public-private partnership arrangements across the globe. We argue that risk selection, a situation where the public partner insures the majority of high risk agents, is potentially an important issue. To illustrate our concerns we build a simple model of reinsurance in a natural disaster Insurance market. We show that risk selection is a likely equilibrium outcome and discuss the policy options available. The model is based on the French institutional setup and describes well the stylized facts. The policies implemented by the French government correspond to the ones we identify to alleviate risk selection. We also present two alternative public-private partnership setting that deal effectively with risk selection; hurricane insurance in Florida and catastrophe insurance in Spain.