Open AccessNatural disaster insurance: public-private sector partnership
Author(s) -
Tülin Altun,
Nevzat Güldiken
Publication year - 2019
Publication title -
journal of human sciences
Language(s) - English
Resource type - Journals
ISSN - 2458-9489
DOI - 10.14687/jhs.v16i3.5843
Subject(s) - business , private sector , public sector , general partnership , casualty insurance , finance , sustainability , general insurance , public–private partnership , government (linguistics) , insurance policy , business interruption insurance , public economics , economics , income protection insurance , economic growth , ecology , linguistics , philosophy , economy , biology
The public sector should intervene in the natural disaster insurance market in order to increase economic efficiency and social welfare. However the governments should not put at risk the sustainability of public finance by undertaking excessive financial risks. Therefore, public-private sector partnership practices in natural disaster insurance are on the agenda. Public-private partnerships can incorporate some of the advantages of both public insurance systems and private insurance systems. In such insurance systems, government guarantees, fiscal incentives, regulations and private sector expertise come together. The insurance systems established in public-private partnership sectors should be designed appropriately to ensure sustainability. A sustainable public-private insurance system should include mandatory participation, risk-based premiums, encouraging risk-mitigation activities, risk transfer mechanisms. NFIP, CEA, CATNAT, TCIP, CCS, JER are successful examples of public-private sector partnership. However, these insurance systems do not have all the features that a good insurance system should have.