Analysis on earthquake loss compensation system from Japan

Earthquake is one of the serious disasters which may induce heavy casualties and economic losses. Japan is a country with frequent earthquake disasters. Administrative authority for disaster management in Japan covers the central government, local governments and public institutions. Earthquake insurance has become the important way to manage significant disastrous risk in Japan. As a socialized system for disaster loss dispersal, insurance against earthquake does not play a role in China. Financial aid from Government makes the main body of loss compensation system. Commercial insurance coverage does not play a role in bear disaster loss. Victims take main loss in disaster. After analyzing current earthquake insurance model and investigating practice from Japan for reference, it reveals that construction of earthquake risks diversification relies on inevitability of government function changed, improvement of insurance market and emphasis the demotic consciousness in China.