Disaster risk insurance: A comparison of national schemes in the EU-28

This paper analyses the insurance schemes against losses from natural disasters, in place in the EU-28 for residential properties, showing their complexity and variety. The comparison leads to the following conclusions. First, very high insurance penetration rates are usually associated with the direct involvement of the Government in the scheme, while they are not strictly correlated to its voluntary or compulsory nature, also because many intermediate solutions have been developed by EU countries. Second, since the link between insurance and risk reduction is not automatic, creative supporting measures are being tested by insurance schemes across the EU. Their success is, anyway, often disputed and needs to be further investigated. Third, the way ex post Government compensation is shaped does not directly impact on insurance penetration rates, but a certain degree of coordination between ex post Government compensation and insurance programs has the advantage of improving the efficient allocation of financial resources in risk management.