This pilot program explores how insurance industry tools and innovations could help North Carolina communities protect their people and economies from climate threats.
Many communities in North Carolina are especially vulnerable to natural hazards caused or exacerbated by climate change: flooding, sea level rise, landslides, wildfires, shoreline erosion, saltwater intrusion, and more. As the cost of insurance escalates, the number of uninsured households in these areas is rapidly rising. The Nicholas Institute is partnering with the North Carolina Office of Recovery and Resiliency (NCORR) on a pilot program to connect vulnerable communities with risk analytics tools and innovative products from the insurance industry.
This collaborative pilot program—”Leveraging Risk Analytics and Insurance Innovation to Manage Natural Hazard Risks”— explores how insurance sector data, analytics, modeling, and other capabilities can help inform communities’ plans for adapting to climate change. It will engage Duke faculty and students to develop a process for creating open source risk analytics to help communities evaluate and managing increasing risk from natural hazards. The process will also assist communities in examining how new insurance products (e.g., community-based catastrophic insurance) could help vulnerable communities face their growing climate risks. The new insurance approaches could address gaps in insurance coverage, the costs of or time lag in disaster response and recovery funding, and the need for community and regional scale incentives for risk reduction.
The effort will leverage two Duke programs that bring faculty and students together to pursue interdisciplinary research: Climate+ (summer 2024) and Bass Connections (2024-2025 school year).
Project Workplan
The initial phase of the program has engaged local technical assistance providers, nonprofits, state agencies, insurers, and other stakeholders to explore how communities are currently using information on climate risks and risk management tools, where there are gaps, and how insurance sector data and novel approaches could help.
In addition to laying the groundwork for innovative solutions in these communities, experts from the Nicholas Institute and NCORR will be sharing learnings, and potential solutions with other at-risk communities in North Carolina and beyond.
