It is proposed that Greece undertakes the establishment of a national earthquake insurance programme for homeowners that will replace the ex post disaster relief by the State when an earthquake occurs. Greece is seismically the most active region in the whole Mediterranean. By employing four different catastrophe models, it has been estimated that the economic loss to the residential stock of a 1-in-200 year event is likely to be greater than 22 billion euros; for a 1-in-100 year event is about 14 billion euros; for an 1-in-25 year event is 5 billion euros; and for a 1-in-5 year event is 1.3 billion euros. This potential loss severity exposes the inherent limitations of the ex post funding approach to natural disasters adopted by successive Greek governments and underscores the urgent need for establishing a National Earthquake Insurance Programme. It is proposed that the earthquake coverage should be compulsory and the management of the insurance programme be based on the principle of a public-private partnership. The objective of the programme would be to provide affordable earthquake insurance, up to a maximum amount, to all homeowners, on the basis of risk-based premiums. A comprehensive and unique data bank of the residential stock in the country has been developed, which will be very useful to the local insurance industry as well as to reinsurers.
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This paper proposes an integrated risk management plan for catastrophe risks in the European Union, consisting of three layers. The private markets would have the first layer of responsibility, while the National Catastrophe Insurance Organizations would represent the second layer. This layer would in turn be supported by the European Group of National Catastrophe Organizations (EUROCAT), a new organization operating under the auspices of the European Commission. An approach that utilizes a pan-European reinsurance program is proven to be the most efficient solution for minimizing the total cost of catastrophe risks in the European Union. EUROCAT would be a reinsurer of last resort and provide reinsurance to qualified state or regional catastrophe insurance funds. Member-state funds would be required to adopt adequate disaster response and management mechanisms and enforce reasonable building code, land use, and mitigation efforts to minimize the amount of insured losses. As the reinsurance premiums charged by EUROCAT would be risk-based, the pricing mechanism would be used to encourage active development and enforcement of these standards.
The objective of this article is twofold: first, to present a holistic approach to insurance regulation and, second, to put forward the proposition that the establishment of guaranty funds will facilitate the effectiveness of the supervisory authorities in the European insurance markets, which will go through the consolidation process. Consolidation will materialise by means of mergers and acquisitions, exits and bankruptcies. It is argued that consumer expectations, intensified competition and the convergence of financial and insurance markets require the establishment of guaranty funds in all Member States of the European Union, in order to deal with the expected increased rate of insurer insolvencies. Such an evolution will provide supervisory authorities with more degrees of freedom in removing earlier impaired insurers from the market, instead of waiting and exacerbating the eventual insolvency deficits. The argument is that, in addition to protecting the victims of insolvencies, such an arrangement is optimal as an insurance device, which will increase consumer confidence and market stability.
Background: The European Union health policy agenda stresses the importance of environmental and qualitative factors in structural hospital reforms. In response to the economic crisis, both cost containment and performance improvements of the Greek hospital sector, have become a pertinent issue for overall reforms. Objective: The study examines the efficiency of 112 Greek public hospitals, by applying bootstrapping techniques and investigating the effect of contextual factors on hospital efficiency. Furthermore, the effect of qualitative evidence, on hospital efficiency is explored by focusing on a subset of 28 large hospitals. Methods: The quality aspects of the Greek hospitals are investigated by applying two models of Data Envelopment Analysis (DEA), augmented by bootstrapping techniques, in order to assess the importance of quality dimensions on the efficiency of hospital scores. In addition, two Tobit regression models are estimated assessing the contribution of contextual factors, in the efficiency and bias-corrected efficiency scores. Results: Efficiency analysis indicated that only 23.2% of the hospitals are fully efficient (0.96-1.00), 37.5% are efficient (0.71-0.95) while 39.3% are inefficient (0.30-0.70). The Kolmogorov-Smirnov test, between the original and the bootstrapcorrected efficiency, indicates that their distributions are significantly different (p-value < .001). The environmental factors, influencing efficiency, are Occupancy Rate and the ratio between Outpatient Visits and Inpatient Days. Results indicate that the inclusion of Risk-Adjustment Mortality Rate significantly influences (p-value < .05) the efficiency of the hospitals. Conclusions: In the era of economic crisis, the inclusion of quality variables and the use of bootstrapping techniques provide a vital framework in assessing the efficiency of the hospital sector.
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