China working on disaster insurance legislation

With flooding becoming more serious in the Yangtze River area, He Hao, the deputy-director of the China Insurance Regulatory Commission has said that China is trying to complete its work on disaster-insurance legislation before the year 2017, Guangzhou Daily has reported.

He said that in the 2017 - 20 period, the new law will be enforced and the insurance will be included in the national disaster prevention and reduction system.

In other countries, for example, the United States, the United Kingdom and Australia, they have insurance as part of their law, for example the US’s National Flood Insurance Act and Flood Prevention Law from the 1950-60s.

In relation to that, Sun Fuliang, head of the China Earthquake Administration, says that natural disaster insurance such as for earthquakes, should be backed by law and we should speed up legislation on it.

And, an article from People’s Daily said that, even though we’re still behind the Western countries, we should promote the legislation based on our own circumstances and use our experiences to build earthquake insurance and improve it.

Sun added that the legislation should specify responsibilities and rights of all parties, including the government and insurance company and we should regulate it.

An article from Guangzhou Daily suggested that insurance companies be encouraged to provide disaster insurance and, since they would be taking on greater responsibility, the government should have related preferential policies in financing and taxes.

Great Britain and Japan have disaster insurance that spreads the risk through various financing channels and, US disaster insurance, the risk is shared by many parties.

These methods could easily be used on China’s disaster insurance, an article from Guangzhou Daily concluded.

Earthquake insurance could help perfect our disaster insurance system and reinvigorate the disaster insurance market, an article from China Construction News said.