Closing the Protection Gap - Disaster Risk Financing: Smart Solutions for the Public Sector

Every year natural and man-made catastrophes cause a distressing loss of lives and considerable economic costs around the world. Both industrialised and developing countries are affected. Surprisingly, both are also materially underinsured.

This financing gap is borne largely by the public sector, and may create long-term fiscal instability at a time when government budgets are stretched. Furthermore rating agencies are starting to take a closer look at such contingent liabilities faced by public administrations.

But there are ways to alleviate both the impacts and the costs of disaster by planning ahead. Insurance plays a critical role in effective disaster risk management helping communities get back on their feet faster. This report outlines tools and approaches proven to help governments, regions and cities, as well as the constituents they represent, to become more resilient.