Understanding Disaster Insurance

- Blurb -

The frequency and intensity of natural disasters-such as wildfires, hurricanes, floods, and storms-is on the rise,threatening our way of life and our livelihoods. Managing this growing risk will be central to economic and socialprogress in the coming decades. Insurance, an often confusing and unpopular tool, will be critical to successfullyemerging from the effects of these crises. Its traditional role is to protect us from unforeseen and unanticipated risk, but ascurrently structured, insurance cannot adequately respond to these types of threats. How can we improve insurance toprovide consistent and sufficient help following all disasters? How do we use insurance not just to help us recover, butalso to help us prevent disasters in the first place? And how can insurance help us achieve broader social andenvironmental goals? Understanding Disaster Insurance provides an accessible introduction to the complexities-and exciting possibilities-ofrisk transfer markets in the U. S. and around the world. Carolyn Kousky, a leading researcher on disaster risk andinsurance, explains how traditional insurance markets came to be structured and why they fall short in meeting the needsof a world coping with climate change. She then offers realistic, yet hopeful, examples of new approaches. With examplesranging from individual entrepreneurs to multi-country collaborations, she shows how innovative thinking and creativeapplications of insurance-based mechanisms can improve recovery outcomes for people and their communities. She alsoexplores the role of insurance in supporting policy goals beyond disaster recovery, such as nature-positive approaches forlarger environmental impact. The book holds up the possibility that new risk transfer markets, brought to scale, couldhelp create more equitable and sustainable economies. Insurance and risk transfer markets can be a powerful tool for adapting to climate change, yet they are frequentlymisunderstood. Many find insurance confusing or even problematic and ineffective. Understanding Disaster Insurance is auseful guidebook for policymakers, innovators, students, and other decision makers working to secure a resilientfuture-and anyone affected by wind, fire, rain, or flood.