Italy's New Insurance Law: A Shift in Disaster Management for Businesses

Italian businesses will soon need mandatory natural disaster insurance due to a new law effective next April. This move aims to reduce reliance on state compensation amid increasing climate-related disasters, but raises concerns about affordability and enforceability, particularly among small and medium-sized firms.

Starting next April, Italian companies will be required to obtain natural disaster insurance, a significant shift from relying on government support for climate-related calamities.

While the new policy could reduce Italy's financial burden amid mounting public debt, small and medium-sized enterprises, a crucial part of Italy's economy, grapple with the potential costs.

With natural disasters becoming increasingly frequent, the enforcement of such insurance is seen as essential, although its success will depend on how well the rules are implemented and on the cooperation of both businesses and insurers.

(With inputs from agencies.)