Catastrophe Insurance Market in the Caribbean Region : Market Failures and Recommendations for Public Sector Interventions

The Caribbean region suffers from a high degree of economic volatility. A history of repeated external and domestic shocks has made economic insecurity a major concern across the region. Of particular concern to all households, especially the poorest segments of the population, is the exposure to shocks that are generated by catastrophic events or natural disasters. The author develops a conceptual framework for risk management and shows that the insurance market for catastrophic risk in the Caribbean region remains a "thin" market characterized by "high" prices and "low" transfer of risk. He analyzes the possible market failures which could explain the lack of development of the catastrophe insurance market. Finally he outlines a set of recommendations for public sector interventions.

Bibliographic Details

Main Author:	Auffret, Philippe
Format:	Policy Research Working Paper biblioteca
Language:	English en_US
Published:	World Bank, Washington, DC 2003-01
Subjects:	CATASTROPHIC PHENOMENA, INSURANCE PREMIUMS, INSURANCE CASUALTY, RISK MANAGEMENT, MARKET FAILURE, NATURAL DISASTERS, DISASTER PREPAREDNESS, DISASTER PRONE AREAS, DISASTER RECOVERY, CROP INSURANCE, WEATHER MONITORING, ADVERSE SELECTION, MORAL HAZARD, LAND USE, REINSURANCE ADVERSE SELECTION, AGENTS, APPROPRIATE TECHNOLOGY, BONDS, BROKERS, BUILDING CODES, CATASTROPHE REINSURANCE, CATASTROPHES, CATASTROPHIC LOSSES, CATASTROPHIC RISKS, CIVIL DEFENSE, COMMODITIES, COMPULSORY INSURANCE, CONCEPTUAL FRAMEWORK, CONSUMERS, CONTINGENCY PLANS, COVERAGE, DEBT, DECISION MAKING, DEVELOPED COUNTRIES, DISASTER ASSISTANCE, DISASTER EMERGENCY RESPONSE, DISASTER INSURANCE, DISASTER MANAGEMENT, DISASTER MITIGATION, DISASTER VICTIMS, DISASTERS, EARTHQUAKE INSURANCE, EARTHQUAKES, EMERGENCIES, EMERGENCY MANAGEMENT, EMERGENCY RECOVERY, EMERGENCY RELIEF, EMPLOYMENT, ENVIRONMENTAL CONTAMINATION, ENVIRONMENTAL MANAGEMENT, EVACUATION, FARMERS, FATALITIES, FINANCIAL INSTITUTIONS, FINANCIAL INSTRUMENTS, FIXED COSTS, FLOOD PRONE AREAS, FLOODING, FLOODS, FUTURES, HOUSING, HURRICANES, INCOME, INSURANCE, INSURANCE COMPANIES, INSURANCE COVERAGE, INSURANCE INDUSTRY, INSURANCE POLICIES, INSURANCE TRANSACTIONS, INSURED LOSSES, LANDSLIDES, LIFE INSURANCE, LOW INCOME, MARKET FAILURES, MITIGATION, MITIGATION MEASURES, MORAL HAZARD PROBLEMS, MORTGAGES, NATURAL HAZARDS, NON-LIFE INSURANCE, POLICY RESEARCH, POLICYHOLDERS, POOR FARMERS, PREMIUMS, PRIVATE SECTOR, PRODUCERS, PROGRAMS, PROPERTY INSURANCE, PROPORTIONAL REINSURANCE, RATES, REGIONAL RISK MANAGEMENT, REINSURANCE COMPANIES, REINSURANCE MARKETS, REINSURANCE PREMIUMS, REINSURERS, RELIEF, RIOTS, RISK ASSESSMENT, RISK MITIGATION, RISK REDUCTION, RISK TRANSFER, RIVER BASINS, RURAL COMMUNITIES, SAVINGS, SCIENTIFIC RESEARCH, SECURITIES, TIMBER, UNDERWRITING, UNINSURED LOSSES, WARNING SYSTEMS,
Online Access:	http://documents.worldbank.org/curated/en/2003/01/2128869/catastrophe-insurance-market-caribbean-region-market-failures-recommendations-public-sector-interventions http://hdl.handle.net/10986/19184
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