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Efficacy of insurance for organisational disaster recovery: case study of the 2010 and 2011 Canterbury earthquakes
Author(s) -
Brown Charlotte,
Seville Erica,
Vargo John
Publication year - 2017
Publication title -
disasters
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.744
H-Index - 70
eISSN - 1467-7717
pISSN - 0361-3666
DOI - 10.1111/disa.12201
Subject(s) - resilience (materials science) , business , preparedness , disaster preparedness , actuarial science , business interruption insurance , exploratory research , insurance policy , risk management , poison control , occupational safety and health , emergency management , finance , medical emergency , general insurance , medicine , economics , economic growth , income protection insurance , physics , management , sociology , anthropology , thermodynamics , pathology
Insurance is widely acknowledged to be an important component of an organisation's disaster preparedness and resilience. Yet, little analysis exists of how well current commercial insurance policies and practices support organisational recovery in the wake of a major disaster. This exploratory qualitative research, supported by some quantitative survey data, evaluated the efficacy of commercial insurance following the sequence of earthquakes in Canterbury, New Zealand, in 2010 and 2011. The study found that, generally, the commercial insurance sector performed adequately, given the complexity of the events. However, there are a number of ways in which insurers could improve their operations to increase the efficacy of commercial insurance cover and to assist organisational recovery following a disaster. The most notable of these are: (i) better wording of policies; (ii) the availability of sector‐specific policies; (iii) the enhancement of claims assessment systems; and (iv) risk‐based policy pricing to incentivise risk reduction measures.