Research On The Plan Of Typhoon Insurance In Zhejiang

With the rapid development of the economy,the damage caused by catastrophes have become more and more serious,causing incalculable losses to the lives and property of the people.China is one of the countries with the most serious natural disasters in the world.However,the proportion of insurance claims in catastrophes has been very low.For instance,the insurance claims for the Wenchuan earthquake accounted for only 0.2%of the actual economic losses,far below the level for developed countries from 30%to 40%.Therefore,it is imperative to accelerate the construction of the catastrophe insurance system at this stage.In recent years,our country has attached great importance to the development of catastrophe insurance.The Third Plenary Session of the 18th CPC Central Committee and "the State Council' s Several Opinions on Accelerating the Development of Modern Insurance Service Industry have all explicitly proposed" the establishment of a catastrophe insurance system.In July 2014,Shenzhen was the first to start a catastrophe insurance pilot.Since then,catastrophe insurance pilots have been launched in Ningbo,Yunnan,Sichuan,and Guangdong,and the pilot work of catastrophe insurance in China has begun.In May 2016,the establishment of an earthquake catastrophe insurance system for urban and rural residential houses marked the beginning of a substantial phase in the construction of China's catastrophe insurance system.Taking into account the frequent occurrence of typhoon in Zhejiang Province,this paper based on the Ningbo catastrophic insurance pilot,making a preliminary design of the implementation of typhoon insurance in Zhejiang Province.First,this paper analyzes the common catastrophic risks and characteristics of Ningbo,and summarizes the three-year trials of Ningbo Catastrophe Insurance comprehensively,including the introduction of the system,the conditions for payment and the operating mechanism,etc.And then further analyze its current existence problem.Secondly,the basic framework of Typhoon Insurance in Zhejiang Province was constructed from the aspects of Typhoon Insurance participants,main contents and supporting measures.Thirdly,different heavy-tailed distributions was selected to fit the typhoon loss data of Zhejiang Province from 1949 to 2016,and the rates was calculated based on the catastrophe insurance rate determination model.Finally,related policy recommendations are made to clarify the role of the government in the operation of typhoon insurance.The article finds that the catastrophe insurance "Ningbo Model" has a strong reference for the design of typhoon insurance in Zhejiang Province,but there are also issues,such as the high loss ratio leading to an increase in government burden,the incompleteness of the risk dispersion mechanism,etc.In the construction of Zhejiang Typhoon Insurance,a multi-level risk sharing mechanism should be adopted that is“government-based,commercial insurance company-assisted".In the framework of the operation,the government of Zhejiang Province should take the lead and the ten prefecture-level cities(except Ningbo)should operate independently.In addition,the government should also take corresponding supporting measures,including financial subsidies for rates,policy advocacy and community management.Empirical research results show that the amount of typhoon losses in Zhejiang Province is subject to lognormal distribution,and the number of typhoon occurrences is subject to Poisson distribution.Besides,the basic rate is 5.1%and the premiums in local cities is calculated according to the gradient coefficient.In terms of policy recommendations,the paper points out that the government should achieve the goal of social management by establishing and promoting typhoon insurance,improving the typhoon disaster database,strengthening cooperation with commercial insurance companies continuously as well as using the subsidy leverage to encourage the public to purchase insurance,thereby enriching and developing China's catastrophic risk management system.