SUSTAINABILITY HUB

Risk awareness & prevention

Prevention is at the heart of improving climate change adaptation and resilience. “We need to prevent the un-adaptable and adapt to the un-preventable”, as the European Commission said in its 2021 EU Climate Adaptation Strategy.

European insurers are committed to supporting efforts to tackle the climate protection gap by contributing to boosting prevention, based on their long-standing expertise in this area. Prevention is embedded in the practices of the private insurance sector and is a cornerstone of any insurance scheme. It is especially important for extreme weather events which, without any prevention measures in place, would be very difficult to insure.

Prevention is not possible without risk awareness. The insurance industry plays an important role in raising risk awareness, based on the expertise it has gained through extensive research and long experience. Insurers also contribute to awareness-raising through the conditions they include in their policies (see the Underwriting section). Requiring individuals and companies to finance solutions themselves makes them more aware of the risks and financial consequences they face. This encourages them to further limit their exposure by taking more preventive measures and helps mitigate the human, economic and financial costs resulting from climate-related disasters.

Increased risk awareness paves the way for effective prevention measures and risk-averse policies, such as building codes that prevent construction in high-risk zones, for instance flood plains. Such measures by public authorities are vital if insurers are to continue to be able to provide affordable cover for climate-related risks. Insurers across Europe are therefore keen to continue working in collaboration with public authorities and other stakeholders on loss prevention and awareness-raising (see the Public-private partnership section).

Click on the examples below for more information.

Awareness-raising campaigns

Education

Tools & solutions for consumers

Tools & solutions for insurers

Forecasting & early warnings

Natcat cover

Europe’s insurers and reinsurers have decades of experience covering losses caused by natural hazards and providing effective disaster risk management advice to policymakers and citizens. However, their precise roles and responsibilities depend both on the rules in place in each country and the widely different risks they face.

National solutions therefore vary, ranging from purely optional private market cover to national pools and compulsory cover for certain risks. This results in a great deal of diversity in the natcat insurance markets of Europe.

Floods

Insurers usually provide compensation for flood losses. They also use their considerable flood-risk expertise to play a role beyond this risk transfer; they are often active in raising risk awareness and in increasing the understanding of flood risks and how to reduce them, both among policymakers and the general public.

Click on the examples below for more information.