Evaluating the Role of Insurance in Managing Risk of Future Pandemics

27 Pages Posted: 24 Jun 2021

See all articles by Howard Kunreuther

Howard Kunreuther

University of Pennsylvania - Wharton Risk Management and Decision Processes Center; National Bureau of Economic Research (NBER)

Jason Schupp

Centers for Better Insurance, LLC

Multiple version iconThere are 2 versions of this paper

Date Written: June 10, 2021

Abstract

This paper provides stakeholders with a practical framework, informed by the recent experience with COVID-19, for defining a meaningful role for insurance in managing business interruption (BI) and other risks from future pandemics. The insurance industry will be part of that solution set, whether through the continued development of ad hoc state-by-state initiatives, a private-public partnership in which the insurance industry commits its servicing capabilities, or a private-public partnership drawing on both its servicing and risk-bearing capabilities. Policymakers, regulators, businesses, and other stakeholders interacting with representatives from the insurance industry can assist in defining its role in providing protection against the financial consequences of future pandemics. This framework, while designed for dealing with future pandemics, may be applied to other catastrophic and systemic risks.

Keywords: insurance, public-private partnerships, pandemics, catastrophic risk

JEL Classification: D81, D91, G22, H84

Suggested Citation

Kunreuther, Howard C. and Schupp, Jason, Evaluating the Role of Insurance in Managing Risk of Future Pandemics (June 10, 2021). Available at SSRN: https://ssrn.com/abstract=3868224 or http://dx.doi.org/10.2139/ssrn.3868224

Howard C. Kunreuther (Contact Author)

University of Pennsylvania - Wharton Risk Management and Decision Processes Center ( email )

3819 Chestnut Street
Suite 130
Philadelphia, PA 19104
United States
215-898-4589 (Phone)

National Bureau of Economic Research (NBER)

Jason Schupp

Centers for Better Insurance, LLC ( email )

9006 Bush Creek Circle
Frederick, MD 21704
United States

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