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Best practices on and piloting insurance solutions for climate adaptation in EU regions and communities


This topic relates to all three objectives of the strategy, and is part of the key enabling conditions described in the Mission Implementation Plan[[Page 9 climat_mission_implementation_plan_final_for_publication.pdf (]], to test novel insurance solutions, insurance products and risk-transfer mechanisms. The applied research and the experimentation with innovative solutions as further outlined below under points 1 and 2 should be at the centre of the project.

Insurance is a key tool to compensate for losses after extreme climate events, yet its use in the climate adaptation domain is limited at the moment for a variety of reasons. Recent studies show that between 1980-2019, direct economic losses in EU-27 from climate-related events totalled at least EUR 419 billion[[EIOPA’s pilot dashboard addresses the natural catastrophe protection gap | Eiopa (]]. Only 35% of these losses were insured on average across the EU.

Proposals should address both the following aspects:

1. Best practices and filling the gaps on insurance coverage for climate adaptation

The proposal should address barriers to the use of insurance for climate adaptation, and improve the insurance cover in regions and communities.

Therefore, proposals should:

  • Prepare a collection of weather and climate risk insurance products and best practices that could be included to existing products or replicated as new products in EU regions and communities
  • Develop and implement mechanisms to collect and share comprehensive and harmonized data on climate-related risk and losses. Such mechanisms and data should be integrated with the Risk Data Hub
  • Develop guidance capturing best practice on insurance pricing encouraging users to invest in adaptation and ensuring affordable insurance cover
  • Feed into the deliberations of the Climate Resilience dialogue making available draft deliverables, as relevant.
  • Provide direct support to at least three regions by:
    • Sharing relevant state-of-the-art knowledge, best practices and emerging innovations on insurance solutions,
    • Presenting advice on insurance gaps to be addresses by public budgets in the regions, and
    • Providing guidance and support regarding the type of insurance product that would best address the climate risks the region or community is and will face; look for actual products for these regions.

2. Trialing and experimentation of insurance solutions in EU regions and communities

As climate impacts become more severe and frequent European regions and communities need to lead by example by procuring insurance solutions to transfer risks and compensate for loses. The proposal should build on the guidance developed under the first element and start piloting insurance solutions that can increase Europe’s resilience and preparedness to face unavoidable consequences of climate change.

The proposals should:

  • Develop a pilot of innovative insurance solutions in at least three regions or communities (vulnerable to different climate risks and located in different geographical areas) to address their climate risks. Such solutions could be new ones or from improving existing ones.
  • Inform their plans with the guidance and recommendations from the deliverables under point 1.
  • Demonstrate sustainability of the solutions piloted beyond the life of the project.

The project should work closely and establish synergies with other projects within the Mission and other relevant initiatives in the domain of climate adaptation insurance, such as the Climate Resilience dialogue, work being done by the European Insurance and Occupational Pensions Authority (EIOPA), relevant Horizon 2020 projects[[ Horizon 2020 Insurance, NAIAD, ReSet, among others]].

The consortia should include as associated partners[[as per Horizon Europe general annexes: entities participating in the action but without the right to charge costs or claim contributions]] at least one insurance and/or re-insurance company in order to pilot the proposed actions. Furthermore, this topic requires the effective contribution of SSH disciplines and the involvement of SSH experts, institutions as well as the inclusion of relevant SSH expertise, in order to produce meaningful and significant effects enhancing the societal impact of the related research activities.

In line with the overall principles of the Mission, proposals should take in full consideration the local dimension of climate change and climate adaptation strategies, clarify how they would ensure a meaningful engagement with local communities as well as stakeholders to ensure, among others, the mobilization of local knowledge, and outline how they would contribute to achieving a just transition to climate resilience.

The European Commission intends to establish a network and coordination activities amongst all the projects funded for the implementation of the Climate adaptation Mission, under the Horizon 2020 European Green Deal call and under Horizon Europe relevant for adaptation, and that will be coordinated by the soon to be established Mission Implementation Platform. These networking and joint activities could, for example, involve the participation in joint workshops, the exchange of knowledge, the development and adoption of best practices, or joint communication activities. The project under this topic will be requested to contribute to this effort. Applicants should acknowledge this request and already account for these obligations in their proposal, making adequate provisions in terms of resources and budget to engage and collaborate with the Mission governance.