WORKSHOP – Can insurance support NBS for wildfire risk management?
On 22nd of May, from 14:00 to 17:30, NATURANCE and Firelogue co-organised a workshop titled “Can insurance support NBS for wildfire risk management?”. This first technical workshop focused on exploring how EU and national insurance regulations can facilitate the adoption of NbS for wildfire risk, aiming to produce an expertendorsed commentary piece. It followed up on discussions from the NATURANCE Innovation Lab, addressing key questions.
Participants discussed the feasibility of integrating NbS into wildfire models, noting that while models can accommodate fuel load reduction measures like prescribed burns and grazing, broader ecological measures such as increasing moisture pose greater challenges.
Regarding parametric insurance products, it was observed that they can incorporate disaster risk reduction (DRR) and NbS into pricing strategies, particularly evident in developments from California. However, regulatory complexities exist as some countries mandate insurance to be tied to actual losses, which does not always align with parametric products.
Additionally, the meeting explored options for pooling risks across communities and incentivizing NbS and DRR through insurance mechanisms. Strategies like those seen in the US National Flood Insurance Program, where communities implementing DRR measures receive insurance premium discounts, were highlighted. California’s approach of adjusting insurance pricing based on wildfire DRR, and experiences from the Netherlands in flood insurance, provided further insights into incentivizing DRR through insurance practices.