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Flood risk will increase in many areas around the world due to climate change and increase in economic exposure. This implies that adequate flood insurance schemes are needed to adapt to increasing flood risk and to minimise welfare losses for households in flood-prone areas. Flood insurance markets may need reform to offer sufficient and affordable financial protection and incentives for risk reduction. Here, we present the results of a study that aims to evaluate the ability of flood insurance arrangements in Europe to cope with trends in flood risk, using criteria that encompass common elements of the policy debate on flood insurance reform. We show that the average risk-based flood insurance premium could double between 2015 and 2055 in the absence of more risk reduction by households exposed to flooding. We show that part of the expected future increase in flood risk could be limited by flood insurance mechanisms that better incentivise risk reduction by policyholders, which lowers vulnerability. The affordability of flood insurance can be improved by introducing the key features of public-private partnerships (PPPs), which include public reinsurance, limited premium cross-subsidisation between low- and high-risk households, and incentives for policyholder-level risk reduction. These findings were evaluated in a comprehensive sensitivity analysis and support ongoing reforms in Europe and abroad that move towards risk-based premiums and link insurance with risk reduction, strengthen purchase requirements, and engage in multi-stakeholder partnerships.
Preface
(2016)
Brief communication
(2016)
In March 2015, a new international blueprint for disaster risk reduction (DRR) was adopted in Sendai, Japan, at the end of the Third UN World Conference on Disaster Risk Reduction (WCDRR, 14-18 March 2015). We review and discuss the agreed commitments and targets, as well as the negotiation leading the Sendai Framework for DRR (SF-DRR) and discuss briefly its implication for the later UN-led negotiations on sustainable development goals and climate change.
Flood estimation and flood management have traditionally been the domain of hydrologists, water resources engineers and statisticians, and disciplinary approaches abound. Dominant views have been shaped; one example is the catchment perspective: floods are formed and influenced by the interaction of local, catchment-specific characteristics, such as meteorology, topography and geology. These traditional views have been beneficial, but they have a narrow framing. In this paper we contrast traditional views with broader perspectives that are emerging from an improved understanding of the climatic context of floods. We come to the following conclusions: (1) extending the traditional system boundaries (local catchment, recent decades, hydrological/hydraulic processes) opens up exciting possibilities for better understanding and improved tools for flood risk assessment and management. (2) Statistical approaches in flood estimation need to be complemented by the search for the causal mechanisms and dominant processes in the atmosphere, catchment and river system that leave their fingerprints on flood characteristics. (3) Natural climate variability leads to time-varying flood characteristics, and this variation may be partially quantifiable and predictable, with the perspective of dynamic, climate-informed flood risk management. (4) Efforts are needed to fully account for factors that contribute to changes in all three risk components (hazard, exposure, vulnerability) and to better understand the interactions between society and floods. (5) Given the global scale and societal importance, we call for the organization of an international multidisciplinary collaboration and data-sharing initiative to further understand the links between climate and flooding and to advance flood research.