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    Flood insurance necessary

    China Daily | Updated: 2016-07-08 07:39

    Local residents who have suffered losses as a result of heavy rainfall in southern China have to rely on spontaneous mutual assistance, the government's disaster relief support and non-governmental donations to make up for their enormous losses.

    These three means of assistance, however, only barely provide flood-stricken residents with their basic needs and fail to compensate residents for the loss of their homes. Besides, such assistance usually puts flood victims in a passive position and it is thus difficult to raise their risk awareness and help them take precautions.

    This is in sharp contrast with many developed countries where commercial insurance plays an important role in flood relief. Insurance can help reduce the losses caused by floods through market-based means and change people's dependence on the government's disaster relief aid. While raising the level of disaster relief, such commercial insurance can also push forward the construction of disaster prevention and alleviation facilities.

    Flood insurance necessary

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