Is it possible to insure against an asteroid impact event?Is it possible to insure against an asteroid impact event? https://asteroidday-uploads.s3.eu-central-1.amazonaws.com/wp-content/uploads/2018/12/03100145/asteroid-belt-debbie-lewis.jpg 1200 628 Asteroid Day https://asteroidday-uploads.s3.eu-central-1.amazonaws.com/wp-content/uploads/2018/12/03100145/asteroid-belt-debbie-lewis.jpg
Since it is recognised that the cost of the response to a significant asteroid impact event would be beyond the financial capabilities of an individual country to respond an international geopolitical response is required. Consideration should also be given to a new category of sovereign insurance or macro-insurance. This would inevitably better enable governments to manage the response to disasters. This means that the victims of natural disasters would then be provided with immediate relief without governments having to place substantial liability on public finances. A securitisation programme can also be developed which enables the risks from natural or geo-hazards to be transferred to the capital markets. The payout is calculated on the size of the affected population. The utilisation of public and private partnerships enables governments, development banks and Non Government Organisations to control their finances by using insurance and capital market instruments. The slide below, on the economic cost of natural disasters, emphasises this point. Funding for these disasters was obtained after the event, through increases in taxation, the reallocation of funding from other budgets and by accessing national and international credit or increased borrowing. If another disaster were to occur in the future, such as an asteroid impact event, then it would almost certainly be (needlessly) funded in exactly the same way.