The Federation of European Risk Management (FERMA) has called on the EU to create a resilience framework for addressing uninsurable catastrophes like the current pandemic.
The primary concern the organisation is looking to address through its proposal is the gap in business coverage caused by exclusions for non-damage interruption.
The resilience framework proposed by FERMA would function on four levels:
Enterprise-level risk management: anticipation, prevention, identification and mitigation of risks
Transfer of risk to private insurance and reinsurance markets, developing enhanced coverage for NDBI (non-damage business interruption)
National Member state pool guarantees
European Union support for, and coordination between national governments
FERMA president Dirk Wegener said: “This holistic approach supported by the insurance sector, national governments and EU institutions would ensure that the resilience framework has the capacity to benefit all businesses, from small and medium-sized enterprises facing immediate liquidity issues, to the largest transnational corporations concerned with supply chain and trade disruptions.
“We now aim to deepen discussions with the EU, the Member States and the insurance sector, and to develop solutions for both short-term crisis management and long-term business resilience.
“FERMA members have expertise and experience in the field of business interruption that we want to contribute to the future resilience of European business.”