Drafted through World Bank’s assistance, the proposed legislation aims to create a legal and financial mechanism to cover earthquake-related damages, ensuring rapid and efficient compensation for affected homeowners.

A dedicated Earthquake Fund, managed as a public joint-stock company under the Finance Ministry, would oversee payouts.

The insurance would cover only material property damage and exclude bodily harm, personal belongings, and indirect financial losses. Non-compliance could result in restricted access to key public services, including State Cadastre and business registration.

Authorities say the reform is vital in a country highly exposed to natural disasters. A devastating earthquake that hit Albania in November 2019 caused damages amounting to 7.5% of GDP and affected over 200,000 people.

The new law is expected to reduce the fiscal burden of future catastrophes and strengthen disaster resilience.

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