Property Insurance Challenges in the ECCU

Property insurance affordability presents a growing challenge for the ECCU. With a high reliance on global reinsurance to manage risks in high-exposure products like property, the recent tightening of global reinsurance market conditions has largely passed through to local premiums and constrained capacity to extend coverage. The rising costs exacerbate the already acute non-and under-insurance challenges in the region. These can worsen the economic and fiscal impacts of natural disasters and, if further exacerbated, raise broader macro-financial stability risks by weakening asset quality and credit conditions. Enhancing the ECCU’S readiness to manage these risks calls for concerted efforts to strengthen insurance data collection, risk analysis, and regional supervision. These would inform the appropriate design and calibration of policies to help close protection gaps, contain future market pressures, and mitigate broader financial system risks.