Insurance vs. compensation for disaster

Author

Yokomatsu, Muneta ; Kobayashi, Kiyoshi

Author_Institution

Dept. of Social Syst. Eng., Tottori Univ., Japan

Volume

1

fYear

2004

fDate

10-13 Oct. 2004

Firstpage

1030

Abstract

Several institutional frameworks were enacted by jurisdictions in Japan, which were intended to provide some type of economic aid (compensation) to households that are deprived of their dwellings by natural disaster and intend to reconstruct and/or rent a house in the damaged region. In this work a dynamic model is formulated to investigate house-owners and tenants´ housing choice after their dwellings are destroyed by an earthquake as well as owners´ insurance behavior before the earthquake. The study analyzes the effects of the subsidy for reconstruction and/or lease (compensation) on the housing market in the damaged region. It is found that the compensation motivates damaged households to reconstruct and/or rent a house in the damaged region and consequently prevents households from flowing out of its region, while insurance has neutral effect on housing choice.

Keywords

disasters; insurance; legislation; disaster compensation; disaster insurance; dwellings; economic aid; house damage reconstruction; housing market; migration; natural disaster; Bonding; Disaster management; Earthquakes; Ethics; Government; Hazards; Insurance; Systems engineering and theory; Technological innovation;

fLanguage

English

Publisher

ieee

Conference_Titel

Systems, Man and Cybernetics, 2004 IEEE International Conference on

ISSN

1062-922X

Print_ISBN

0-7803-8566-7

Type

conf

DOI

10.1109/ICSMC.2004.1398440

Filename

1398440