The United Nations (UN) and the World Bank Group has announced the formation of the Insurance Development Forum (IDF) to be led by XL Catlin deputy executive chairman Stephen Catlin.
Catlin will chair the IDF, which aims to incorporate insurance risk measurement knowledge into existing governmental disaster risk reduction and resilience frameworks.
The IDF also seeks to build out a more sustainable and resilient global insurance market in a world facing growing natural disaster and climate risk.
Catlin’s co-chairs will be World Bank Group chief financial officer Joaquim Levy and UN Development Program administrator and former New Zealand Prime Minister Helen Clark.
“My grandchildren expect me to make responsible decisions that affect their future. Insurers’ risk management skills help us assess natural disaster risk and can be exported to allow governments at all levels to reduce future losses by designing in resilience into infrastructure projects; and in increasing the use of insurance as a pre-disaster economic resource to allow people to protect their families, property and assets,” Catlin said.
He said risk identification, measurement, pooling and diversification are important features of any successful insurance program and that regulation must recognize their value and purpose.
“These skills can increase the utilization of insurance which will reduce the reliance on post-disaster aid and better target resources to the most important and needed humanitarian crises,” Catlin added.
Catlin said research has shown that a 1% increase in insurance penetration can reduce the disaster recovery burden on taxpayers by 22%.
In a joint statement, leaders from the UN, World Bank Group and the insurance industry stressed that over 90% of economic costs of natural disasters in the developing world are uninsured.
“The IDF Mission is to better understand and utilize risk measurement tools that will help governments apply that knowledge at multiple levels in order to better deploy governmental resources targeting resilience to protect people and their property.”