Because insurance companies' technological advantages in underwriting, claims assessment, pricing, and other aspects undoubtedly provide better technical support for disaster risk management, establishing a disaster risk management mechanism requires the strong participation of commercial insurance companies. At the same time，proved that insurance companies take scenti methods, catastrophe insurance are able to gain new and prosperous development in addition to making preventions for disasters. Below are relevant and detailed description that how to establish useful system.
1.Vigorously developing insurance products related to catastrophic risks, such as life insurance, which can develop insurance products for major natural disasters and accidental injuries; Property insurance can develop catastrophe insurance products specifically targeting catastrophic risks.
2.Different operating modes can be adopted for different types of insurance. For example, family property catastrophe insurance can adopt a policy based insurance model that is mainly coordinated by the government and supplemented by commercial insurance. The government provides basic insurance protection for residents' family property. For family property insurance that exceeds the basic protection limit, it can be provided by commercial insurance. The government can provide subsidies to residents who purchase catastrophe commercial insurance; Corporate property catastrophe insurance can adopt a model mainly based on commercial insurance and indirectly participated by the government.
3.From the perspective of underwriting, geographic underwriting can be adopted, utilizing geographic information systems to conduct risk assessment and loss analysis on the insurance subject matter. Underwriting conditions and rates can be determined based on the economic situation of different regions, the solvency of the insurance industry, as well as the frequency and degree of losses caused by major disasters. For example, establish a basic rate based on the premise of adjusting the rate according to the regions and frequency of natural disasters. The specific insurance rate for earthquake insurance can be treated differently based on the seismic resistance level of the house, and different seismic resistance standards enjoy different premium preferential policies, thereby strengthening local earthquake prevention measures. In short, one or several major disaster risks can be selected as pilot projects in economically developed regions, gradually accumulating experience.
4.From a claims perspective, basic technical work should be done well, such as establishing a catastrophic loss model. With this information, more scientific claims standards can be formulated. For catastrophe insurance, after the occurrence of an accident, flexible application of compensation standards should also be adopted, and if necessary, accommodative compensation can be adopted.
5.Insurance companies can include catastrophe reserves in cost accounting, which facilitates the formation of accumulation and long-term stability of the company's financial situation.
6.Establish a disaster co insurance system. A single commercial insurance company cannot withstand catastrophic losses, so insurance companies should unite to form a catastrophe co insurance body and jointly bear the risk of a catastrophe. Of course, the operation of a co insured entity requires financial support and tax incentives from the government, and commercial reinsurance must be purchased in the international market.
