The role of insurance services in risk management of natural

The role of insurance services in risk management of natural hazards
European context – French experience
Roland NUSSBAUM1
Mission Risques Naturels, Paris, France
ABSTRACT
The insurance industry has a strong interest in effective risk management, and works actively
to encourage policies and actions that manage natural hazard risk to people and property. This
presentation outlines the role of the insurance industry in encouraging action on natural hazard
risk management through: (i) political influence, (ii) public awareness, (iii) technical
developments, and (iv) market forces. After introducing the economic issues at stake, the
presentation highlights the European evolving context, both at the side of concerned European
policies and at the side of Comité Européen des Assurances (CEA). The presentation then
draws on some of the original work being undertaken by the CEA to examine market trends on
related more specific technical issues, illustrating needs for public private partnership (PPP).
The French “catnat” insurance and risk prevention system is then featured as a unique PPP
scheme between State and insurance sector, referring to concepts introduced into EU
Commission’s Green Paper on Public Private Partnerships (PPP) and Community law on
public contracts and concessions [COM (2004)327 dated 30.04.04].
Finally some conclusions are drawn about the way markets should work more effectively in
partnership with public authorities, particularly the Government, to provide effective and
sustainable natural hazard risk management (both physical and financial).
BIOGRAPHY
Graduated both as economist engineer (Ecole des Mines de Paris, 1979) and MBA (CPA, Paris Chamber of
Trade, 1991), Roland NUSSBAUM is currently managing Director of the Association « Mission des sociétés
d’assurance pour la connaissance et la prévention des risques naturels », between Fédération Française des
Sociétés d’Assurance (FFSA) and Groupement des Entreprises Mutuelles d’Assurance (GEMA). Until creation of
this association, early 2000, Roland was in charge of the Economic Affairs Department, as well as IT,
reinsurance and statistics, of GEMA, since 1995.
After having started his career as project engineer within industrial engineering activities (TECHNIP group)
Roland joined AGF group in 1986, first at Commercial lines Division, second as Managing Director of a risk
management services subsidiary, third at International Division. From 1992 to 95, he was seconded as « Expert
National Détaché » to the European Commission Services, Directorate General XV (Internal market and Financial
Services), Insurance and Pension Funds Unit.
Roland is also mandated as :
• Chairman of the « Natural Hazards” Working Group within Property Committee of Comité Européen
des Assurances (CEA),
• Member of the Bureau of Association Française pour la Prévention des Catastrophes Naturelles
(AFPCN).
• Invited professor of risk management and insurance at various Universities and Engineering schools.
1
This paper may not reflect the opinion of the organizations the author is working for. Views and references
given are much influenced by the French case. One should bear in mind that there are market situations where
no natural hazards insurance is available at all, neither through market capacity nor public private partnership
schemes and/or residual market mechanisms.