SACE Reinsurance Launched to Cover Damage Caused by Natural Catastrophes

SACE has started operations for the release of the public guarantee aimed at increasing the resilience of Italian companies against damage caused by natural disasters, reducing the current insurance gap.

The guarantee is issued in favor of insurers and reinsurers authorized in Italy to insure natural disaster risks, providing coverage of up to 50% of the insurance compensation that the companies will pay to the insured Italian companies in the event of the natural disaster events covered by the insurance policy.

The coverage provided by SACE is guaranteed by the Italian State

The 2024 Budget Law has, in fact, introduced for the first time in Italy an insurance system to cover natural catastrophe risks. In particular, all companies – with the exception of agricultural ones – with registered office in Italy or foreign companies with a permanent establishment in Italy, are required to stipulate by March 31st, 2025 insurance contracts to cover damage to material assets directly caused by natural disasters and catastrophic events that occurred on the national territory, such as earthquakes, landslides, floods, inundations and floods.

In this context, in order to contribute to the effective management of the insurance companies’ portfolio, SACE grants the guarantee in the form of reinsurance at market conditions, covering the compensations up to 50% for a total amount not exceeding the ceiling established by the 2024 Budget Law, equal to 5 billion euros for 2025.

The coverage provided by SACE is guaranteed by the State and is regulated by a specific agreement approved by decree of the Minister of Economy and Finance and the Minister of Business and Made in Italy and published on the SACE website. The insurance or reinsurance company that intends to avail itself of the aforementioned coverage may adhere to the measure by downloading from the website www.sace.it the agreement template and the relative adhesion form that must be sent to the address sacerisicurezza@pec.it within the terms set out in the agreement.

The implementation of this new operation was made possible thanks to the collaboration between different actors of the Country System who contributed to factoring their respective skills to concretely meet the needs of companies, increasing their credit sustainability and determining an efficiency of the processes connected to catastrophic events.

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(Featured image by WikiImages via Pixabay)

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First published in ESG NEWS. A third-party contributor translated and adapted the article from the original. In case of discrepancy, the original will prevail.

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