INSURANCE BUREAU OF CANADA LAUNCHES QUAKE COVER INITIATIVE

The Insurance Bureau of Canada (IBC) has announced an initiative to help Canada cope with a major earthquake, although details of the plan are as yet scant. Canadian Underwriter reported that IBC president Don Forgeron gave an outline of the plan at IBC's 11th Annual Regulatory Affairs Symposium in Toronto last Thursday. He noted that "recent events have shown that even countries that have more experience with earthquakes and earthquake preparedness than we do can still get it wrong". The IBC project consists of a study of the potential economic and insured losses that would result from a major quake either in British Columbia or eastern Canada; a consultation paper on the tax treatment of earthquake reserves, and on the potential for insurance linked securities or catastrophe bonds as an alternative source of capital; research on government programmes for emergency preparedness; research into consumer attitudes to the risk and towards quake insurance, and research into the potential roles of government and the non-life sector for financial recovery after a major quake. Mr Forgeron said that this "major project" would be rolled out over the next one to two years.