JPMB - Sovereign Parametric Catastrophe Bonds As Means To Address The Protection Gap In Emerging Countries
As mentioned by AON in their Weather, Climate & Catastrophe Insight: 2019 Annual Report, last year brought $232 billion of economic losses from natural disasters, whereby only $71 billion was actually insured. It outlined that the world continues to face a fundamental issue of insurance gap, especially in emerging and developing countries, where losses for businesses and governments are only increasing following a decade-long rise in natural catastrophes linked to climate change.
Protection gaps exist in both emerging and developed markets. However, with Swiss Re estimating 35% level of catastrophe risk coverage in advanced