Project description
Adaptation and resilience in the face of a changing climate
Natural disasters, exacerbated by climate change, pose a growing economic threat. Conventional insurance risk assessments often focus on single hazards and overlook the complex interplay of multi-hazard risks influenced by climate shifts. Additionally, they neglect the role of human adaptation processes in risk reduction. The ERC-funded INSUREADAPT project will develop multi-hazard climate risk assessments for insurance. It employs agent-based models (ABMs) to understand how people make constrained rational adaptation choices, considering social interactions. Through real-time surveys and economic experiments, INSUREADAPT aims to craft innovative insurance arrangements. These arrangements will encourage policyholders to adapt to evolving climate risks by merging financial coverage with tailored strategies, including communication, incentives like deductibles and premium discounts, and nudges.
Objective
Natural disasters cause substantial economic losses, which are expected to increase due to climate change. The insurance sector plays a central role in managing these risks. It is thus imperative that insurers accurately assess and address climate risks.
Risk assessment methods currently fall short in accurately understanding climate risks because they focus on single hazards (e.g. floods) instead of correlated multi-hazard risks (e.g. windstorms and floods) affected by climate change. They also insufficiently account for human climate adaptation processes leading to risk reduction, which are characterized by bounded rationality and social interaction. Furthermore, additional insights are needed into how to design insurance arrangements that address climate change and stimulate policyholders to adapt to multi-hazard climate risks by limiting natural disaster damage.
This project aims to design insurance arrangements to enhance policyholders adaptation to multi-hazard climate risks by combining financial coverage with comprehensive strategies for stimulating risk reduction. Its interdisciplinary approach goes beyond the state-of-the-art by creating novel multi-hazard climate risk assessments for insurance and by developing agent-based models (ABMs) that account for boundedly rational human adaptation decisions and social interaction. The ABMs evaluate natural disaster insurance arrangements for EU countries with diverse risk contexts and assess strategies for stimulating adaptation by policyholders, based on input from behavioural economic studies. Repeated and real-time surveys and economic experiments will identify comprehensive strategies for triggering behavioural change to stimulate adaptation to the multitude of climate change risks individuals face. These strategies linked to (publicprivate) insurance combine communication on risk and risk reduction measures, insurance incentives (e.g. deductibles, premium discounts), and nudges.
Keywords
Project’s keywords as indicated by the project coordinator. Not to be confused with the EuroSciVoc taxonomy (Fields of science)
Project’s keywords as indicated by the project coordinator. Not to be confused with the EuroSciVoc taxonomy (Fields of science)
Programme(s)
Multi-annual funding programmes that define the EU’s priorities for research and innovation.
Multi-annual funding programmes that define the EU’s priorities for research and innovation.
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HORIZON.1.1 - European Research Council (ERC)
MAIN PROGRAMME
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Topic(s)
Calls for proposals are divided into topics. A topic defines a specific subject or area for which applicants can submit proposals. The description of a topic comprises its specific scope and the expected impact of the funded project.
Calls for proposals are divided into topics. A topic defines a specific subject or area for which applicants can submit proposals. The description of a topic comprises its specific scope and the expected impact of the funded project.
Funding Scheme
Funding scheme (or “Type of Action”) inside a programme with common features. It specifies: the scope of what is funded; the reimbursement rate; specific evaluation criteria to qualify for funding; and the use of simplified forms of costs like lump sums.
Funding scheme (or “Type of Action”) inside a programme with common features. It specifies: the scope of what is funded; the reimbursement rate; specific evaluation criteria to qualify for funding; and the use of simplified forms of costs like lump sums.
HORIZON-ERC - HORIZON ERC Grants
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Call for proposal
Procedure for inviting applicants to submit project proposals, with the aim of receiving EU funding.
Procedure for inviting applicants to submit project proposals, with the aim of receiving EU funding.
(opens in new window) ERC-2022-COG
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Net EU financial contribution. The sum of money that the participant receives, deducted by the EU contribution to its linked third party. It considers the distribution of the EU financial contribution between direct beneficiaries of the project and other types of participants, like third-party participants.
1081 HV Amsterdam
Netherlands
The total costs incurred by this organisation to participate in the project, including direct and indirect costs. This amount is a subset of the overall project budget.