Insuring homes against extreme weather events: a systematic review of the research

Abstract

Home insurance for extreme weather events is a significant security mechanism not only for individual households but for global finance. As extreme weather events become more frequent and intense, home insurance has been identified by governments as a critical tool for climate adaptation and disaster resilience. However, the growing research literature on the interactions between household insurance and extreme climatic events has not previously been systematically reviewed. In this paper, we analyse 175 original peer-reviewed empirical research papers on this subject, published between 2009 and 2018. We identify areas of research focus, themes, spatial and temporal patterns, and knowledge gaps, and examine policy implications of these findings. We find that an overall focus on flood insurance leaves unanswered questions about the different insurantial challenges posed by storms and wildfire. We suggest existing technocratic and calculative insurance narratives obscure the political and moral assumptions embedded within them, and that these assumptions warrant further investigation in the context of socially legitimate insurance against the impact of extreme weather events.

Disaster insurance and risk transfer mechanisms for natural disasters – challenges and opportunities for a new service discussed in literature reviews

“…The type of natural disaster differs by region in the world, which influences the discussion of disaster insurance. Thus, regarding the disaster type, six papers do not specify a disaster type or do not focus on a single disaster type (Kalfin et al, 2022;Lucas et al, 2021;Orimoloye et al, 2021;Valente et al, 2019;Clement et al, 2018;Ullah & Khan, 2017). Despite flood insurance being unavailable in many countries (Lucas et al, 2021), Table 2 shows a predominance of research focusing on floods.…”

“…It is essential to consider that the risk of disasters and such consequent losses are increasing in various regions of the world due to global socioeconomic growth and climate change (Clement et al, 2018;Alam et al, 2020;Lucas et al, 2021). Consequently, this situation highlights the need for policies that help society cope with the impacts of future natural disasters (Clement et al, 2018).…”

Insurance Retreat in Residential Properties from Future Sea Level Rise in Aotearoa New Zealand

“…Much of the existing literature focuses on questions of consumer willingness to pay rather than insurers' willingness to supply (Booth et al 2022, Browne et al 2015, Dixon et al 2017, Landry 2021. There is little expectation that insurance retreat could soon be commonplace even as governments are increasingly asked to act as the insurer of last resort when insurance supply is disrupted following major catastrophes (Binskin et al 2020, Furukawa et al 2020, Jarzabkowski et al 2019, Kousky 2019, Kraehnert et al 2021, Lucas et al 2021, PRA 2015.…”

Endless November? Citizen Beliefs Concerning Wood As A Construction Material Under Extreme Weather Events

“…This publicity can create a higher level of awareness concerning climate change -induced risks and the need to adapt infrastructure for coping with extraordinary weather events. According to Lucas et al (2021), a personal experience of extreme weather events may affect an individual's likelihood of purchasing home insurance. In addition, climate events are likely to affect operational costs, insurance requirements, and the capital cost of building assets, and thus increase the perceived risks of rising operating and maintenance costs (Alzahrani et al 2016).…”