UN Advisor Recommends Disaster-Prone Countries Turn to Insurance Policies, Not Rely on International Aid
UN Adviser Jeffrey Sachs has recommended that countries at risk for frequent hurricanes consider purchasing national insurance policies to prepare in advance for disaster relief needs, rather than rely on international aid appeals to help residents after a disaster strikes.
Sachs cites an example in which the World Food Programme purchased the first policy relating to humanitarian emergencies on behalf of Ethiopia, which is at risk for severe droughts.
Sachs warns that the cost of widescale implementation of such policies could be prohibitive, but suggests that the World Bank might consider financing the initiative, which would allow countries to pay into a policy over time, rather than having to scramble for funds when they are hardest hit.
Mica Rosenberg, “Economist Pushes Insurance as Answer to Disasters,” Reuters AlertNet, 11 April 2006.