At the 2015 IIS Global Insurance Forum, Howard Kunreuther a Professor of Decision Sciences and Business Economics and Public Policy at the Wharton Business School, discussed the need for public-private partnerships for flood insurance.

Professor Kunreuther sees flood risk in need a better public-private partnership program. With flood insurance, you now have highly subsidized rates with no discounts, even if you are mitigating risk… and the private sector hasn’t played a role. The opportunity, he says, is to develop a program with risk-based premiums. People would then know how hazardous their property is. The downside to a risk-based premium program is that low-income people may not be able to afford new (higher) premiums, so something would have to be done to help them.

For more of our coverage of the IIS Global Insurance Forum, visit the On Demand Library.

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