An Investigation into the Insurability of Pandemic Risk
Amid widespread public discussion on how to address the deep financial implications of COVID-19, The Geneva Association, in collaboration with the University of St. Gallen, has issued a new evidence-based study on the risk-taking capacities of insurers related to pandemics named “An investigation into the Insurability of Pandemic Risk”.
Among the report’s main findings are that, encouragingly, health and life risks for a pandemic resembling COVID-19 pose no fundamental insurability challenges. However, P&C insurers have nowhere near the capacity needed to shoulder projected global output losses of more than USD 4 trillion for 2020. By comparison, they collect USD 1.6 trillion in annual premiums, with just USD 30 billion for business interruption policies
The study is conducted by Kai-Uwe Schanz in collaboration with Alexander Braun, Martin Eling and Hato Schmeiser.