Insurance and other risk transfer and financing mechanisms will become increasingly important in managing catastrophic risk as countries transition to more climate-resilient economies as Egypt considers a new NatCat pool.
Experts discusses how advances in risk mitigation, management, adaptation, and risk transfer are needed to address climate-related catastrophic risks.
According to the Global Facility for Disaster Reduction and Recovery (GFDRR), natural hazards have killed nearly 1,500 people in Egypt over the last 20 years and caused estimated economic damages of $347 million.
This is relevant for Egypt as the region is highly vulnerable to a number of perils, including water scarcity, droughts, rising sea levels, and other climate-related impacts, which are all expected to increase.
For effective risk management, multifaceted strategies are often required to improve a community’s ability to rebound from calamitous events, whether from droughts, wildfires, floods, or other catastrophic occurrences.
Disaster resilience relies on four pillars – preparedness, mitigation, adaptation, and risk transfer – that must be blended more effectively to manage the challenges society faces from issues brought on by climate change.
The ability to anticipate, measure, and manage risks will be a critical advantage to organisations as the transition unfolds. Businesses need to build resilience throughout the transition, analysing the evolving risk environment, preparing for what may happen, and insuring against new types of risk.