Global Topics: Aging Infrastructure

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Aging Infrastructure

Upward loss trends necessitate action

Many factors have contributed to the woeful state of today's infrastructure throughout the world. The mobility of goods and people is increasing. Roads and bridges are collapsing under the weight of more and more heavy vehicles. Our demand for energy and water is rising and placing an enormous strain on supply facilities. Grand achievements from the age of industrialization such as water supply and sewage systems in major cities are starting to show their age. The same is also true of urban transport systems, which can no longer cope with today’s requirements. The problem is compounded by the growing number of natural catastrophes, which place a further burden on our infrastructure.

In reality, all these problems could be solved. However, there is frequently not enough money available to do so or governments prefer to invest in projects that are popular with the voters. Simply put, infrastructure is not sexy. The dilemma could be solved by alternative financing concepts, such as public-private partnerships, infrastructure investment funds or projects which are self-financing through customs and fees.

The insurance industry has also recognized  that aging infrastructure is an urgent problem. It not only carries high loss potential, but also slows down a country’s economic development. Munich Re therefore also lends active support in this domain – providing insurance solutions for major infrastructure projects, without which such projects could never be realized, and participating in infrastructure investments. Here too, however, it is imperative that the projects concerned are sustainable and offer growth potential.

Expertise

Robert S. Beck.
Robert S. Beck, P.E.
Senior Vice President
Corporate Insurance Partners Division
Specialty Markets
Munich Reinsurance America, Inc.


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