The Role of Disaster Regulations and Insurance Regulations on the Development of Disaster Insurance Markets

Recently, the climate regulations and stop-loss regulations have become a central policy parameter globally. In market-oriented economies, insurers as the biggest stakeholder-industry of natural disaster risk are facing the issue related to industry sustainability. Thus, the policy implications of natural disasters regulation on the insurance industry are enormous. Therefore, this chapter has made an effort to analyze the disaster management in the integrated framework. This integrated framework is based upon the analysis of the role of regulatory actions taken by three actors, namely, disaster regulation, insurance regulations, and firms' actions across the three stages of disaster management, namely, pre-disaster, underwriting, and post-disaster stages in G-7 economies. Based on the outcomes of the current analysis, the chapter found that there are two polar opposite integrated models (i.e., isolated best policy model in the case of Japan and spiral policy model in the case of Italy). Five models fall in between the two.