Marsh & McLennan Companies Issues Public Comment on FEMA Notice
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On behalf of
Marsh & McLennan is the leading global professional services firm in the areas of risk strategy and people, with businesses in insurance brokerage, risk management, reinsurance services, talent management, investment advisory, and management consulting. Our four main operating companies are
As a leader in the insurance and reinsurance industry, we fully support
Innovative & High-Impact Investments
The proposed policy as written provides a broad-based structure that emphasizes the need for innovation and flexibility while attempting to drive high-impact investments in mitigation. We recognize that this document, in conjunction with the annual Notice of Funding Opportunity announcements, will be an important resource in setting priorities and guiding applicants to develop high-impact mitigation investments. In addition to these planned efforts, we encourage
The BRIC program represents a meaningful opportunity for
Insurance & Risk Transfer
Insurance is a proven mechanism to drive individual and community resilience. However, in the proposed policy there is only limited mention of the role insurance can play in building resilience. We encourage
Similarly, we encourage
Insurance and risk transfer protections safeguard individuals, businesses, and communities, and protect taxpayer investments.
Public-Private Partnerships
We are pleased to see the mention of public-private partnerships in the draft policy, specifically Principle 3: "Promote partnerships and enable high-impact investments to reduce risk from natural hazards with a focus on critical services and facilities, large-scale public infrastructure, public safety, public health, and communities." These partnerships distinguish BRIC from legacy mitigation programs and have the potential to yield significantly enhanced benefits to the applicant and society as a whole.
We also agree that there are opportunities for applicants to leverage public-private partnerships to fund the projects: "
More broadly, the private sector is willing and able to partner with governments at all levels to proactively understand and manage natural disaster risk exposures. The reinsurance industry remains well capitalized and the level of sophistication and expertise developed over decades in dealing with market-changing catastrophe events puts it in an unrivalled position to withstand most conceivable loss scenarios. By working closely with private sector reinsurance carriers and intermediaries, governments can make important progress in quantifying the impact of climate change and further understanding other emerging risk exposures.
In our recently released report, Protecting Our Planet and the Public Purse, we explore how many governments around the world are working with private sector to design and implement processes that improve financial resilience. The report (enclosed with this letter) touches on several risks confronting public sector entities and outlines six case studies that demonstrate how governments are turning to the reinsurance market for innovative risk mitigation solutions. We encourage
Large Scale Mitigation Programs
The State Property Insurance Programs or Residual Markets throughout the country are uniquely positioned to understand and mitigate many of the state's most high-risk areas. These programs fill critical insurance protection gaps and have a vested interest in reducing risks to maintain efficient operations. Many Residual Markets have expressed interest or previously funded mitigation retrofit programs that seek to incrementally improve building resilience on a large scale. We recommend that
Specifically,
Conclusion
We are encouraged by
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The notice can be viewed at: https://www.regulations.gov/document?D=FEMA-2019-0018-0001
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