If climate change is the topic du jour, so will Nat Cat coverage, and issues with Nat Cat Insurance especially in the Philippines. My previous columns have touched on the need for price adjustments to make Nat Cat protection sustainable in the face of an ever-tightening insurance market, and the fact that local rates have not revised in two decades. What is the point of finding a solution that is not sustainable and will be released after many losses? We have launched initiatives that will provide more domestic nat-cat capacity and increase the effectiveness of merger arrangements to obtain better terms from the global reinsurance market. Another topic being discussed is the launch of a new product specifically designed for those segments of the population who are disproportionately exposed to nat cat incidents and suffer their devastating consequences.
I’m not sure exactly what to expect from not completing these initiatives and reviewing the current cost of Nat Cat coverage. There are some complexities that require the controllers node as the first steps depend on it. We hope to see the forest for what it is, not just the trees. Ultimately, when the rubber hits the road, it is the insuring public that will benefit from having the appropriate coverage that a sustainable industry provides.