4 CHAPTER CONCLUSION IN THE ABOVE CHAPTER, THE MAIN COMPONENTS OF...
2.4 Chapter Conclusion
In the above chapter, the main components of national flood compensation systems have been identified
based on an original categorisation by Paudel (2012). The components and their attributes have been
described in a way which can be used as a basic analytical framework in the next chapter to attempt to
make meaningful comparisons between the country case studies and understand the relative strengths
and weaknesses of each system..
The chapter has highlighted the fact that the components and attributes of flood compensation systems
identified operate together and not in isolation. For example, the high correlation between the
voluntary/mandatory status and flood insurance penetration is captured in categorisations by Swiss Re
(2012) and also by Jongejan and Barrieu (2008). The social welfare aspect of flood insurance is also
reflected in a categorisation by O’Neill & O’Neill (2012). This incorporates the choices policy makers face
when designing flood insurance systems to include, or not, principles of social justice. This is important
to understand the social advantages or disadvantages that private flood insurance might bring to the
Netherlands.
The concept of what it means for a flood insurance system to be effective has been set out . First ,five
general principles of insurance were described as the basis for financially viable and economically
efficient insurance systems in general. Second, the need to overcome the four key challenges of
providing flood insurance was also indicated as a prerequisite to theoretical effectiveness.
accusations of political expediency leading to waste and inefficiency compared to private insurance arrangements that might
slow down the recovery period and therefore lead to an increase overall losses (Botzen & Van Den Bergh (2008).
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