risk sharing Flashcards
(4 cards)
What is the New Zealand Earthquake Commission (EQC)?
A government-run insurance system that helps people after natural disasters like earthquakes and landslides.
The EQC provides financial support to homeowners affected by natural disasters.
How does the EQC share risk?
Everyone with home insurance pays a small fee which is pooled to help cover damage from natural disasters.
This pooling of funds allows for collective financial support in times of disaster.
What happens if the damage from a natural disaster is very big?
The government and private insurance companies also help pay.
This collaboration ensures that the financial burden is not solely on homeowners or the EQC.
Why does the EQC matter?
It spreads the cost of disasters so one person doesn’t have to pay everything, helping people recover more quickly.
This system promotes community resilience and faster recovery after disasters.
