Review of Public and Private Disaster Risk Financing Mechanisms in Central Europe

This study comprises a review of
government post-disaster safety nets as well as those
provided by the private insurance market in four countries
of Central Europe, namely the Czech Republic, Hungary,
Poland, and Slovakia. The study attempts to establish the
extent of financial vulnerability of governments and
households to natural hazards in four countries of Central
Europe by examining: 1) the fiscal policy of four Central
European countries in the areas of post-disaster relief and
reconstruction; and 2) the extent of catastrophe insurance
coverage provided by the private insurance industry in the
region as well as the technical capacity of national
insurance markets to manage catastrophe insurance risk. The
study is intended for four principal audiences: government
officials in Central European countries; World Bank staff
involved in disaster risk financing and reconstruction
projects; the international development community as well as
the private insurance and reinsurance industry. This report
was prepared based on a series of written surveys followed
by interviews with key government officials, government
experts and insurers in four countries of the study. The
field work has been supplemented by a review of the
pertinent literature. The structure of the report is as
follows. chapter one reviews the level of catastrophe
insurance penetration in the four countries of Central
Europe. It also provides an overview of fiscal policies and
mechanisms currently in place for dealing with national
emergencies. Chapter two presents the main findings and
policy recommendations of the study.