APEC considers pooled insurance scheme to help pay for disasters
BACOLOD — Members of the Asia-Pacific Economic Cooperation (APEC) yesterday proposed the establishment of a regional insurance pool to help manage disaster risks, a World Bank expert said at the close of meetings here.
At the end of a two-day meeting on Disaster Risk Finance among member economies, World Bank Specialist on Disaster Risk Financing and Insurance Richard Poulter said experts tackled the possibility of a “risk pool” where APEC members can achieve a lower premium compared to insuring themselves individually.
“It’s a recommendation for the Cebu Action Plan that the feasibility study will be conducted,” Mr. Poulter said in a briefing at the sidelines of the APEC meetings.
“The Cebu Action Plan is due to be finalized in September, at which point this proposal will either be put forward or not so at this stage, it’s a proposal that should be the next step towards whether a risk pool should be established,” he added.
Key requisites for a regional insurance scheme, Mr. Poulter said, are cooperation and data standardization.
“Risk pooling is not the only answer to risk financing strategy. It can form one part of a broader strategy,” Mr. Poulter said.
“Understanding whether a risk pool is appropriate is really the next step,” he added.
Finance Undersecretary Gil S. Beltran, for his part, the Cebu Action Plan will be launched in September when APEC Finance Ministers meet in Cebu. APEC leaders will approve the proposed road map when they meet in Manila in November.
In a statement, the Investor Relations Office of the Bangko Sentral ng Pilipinas noted that Mr. Poulter put forward the Philippine experience as a possible framework for the regional insurance pool.
“Other proposals raised were establishment of a catalogue showing risk exposures of member countries, creation of a platform showing data on insurance coverage of public assets, and engagement of the private sector in disaster risk financing,” the statement said.
Four pillars will mark the Cebu Action Plan to be approved during the Finance Ministerial Meeting in September: “promoting financial integration, advancing fiscal transparency and policy reform, enhancing financial resiliency and accelerating infrastructure development and financing”.