IDEAS home Printed from https://ideas.repec.org/a/gam/jijerp/v18y2021i6p2996-d516953.html
   My bibliography  Save this article

Better Understanding Insurance Mechanism in Dealing with Climate Change Risk, with Special Reference to China

Author

Listed:
  • Feng Kong

    (College of Humanities and Development Studies, China Agricultural University, Beijing 100083, China
    Center for Crisis Management Research, Tsinghua University, Beijing 100084, China)

  • Shao Sun

    (National Climate Center, China Meteorological Administration, Beijing 100081, China)

Abstract

Climate change risk has become an important challenge for global sustainable development. The insurance industry can play an important role in coping with the increasingly severe climate change risk. This paper first describes the increasing climate change risk and the difficulties of the insurance mechanism in dealing with it. Then this paper summarizes the international practice of using the insurance mechanism to deal with climate change risk from ten different aspects. Based on the summary of the role of the insurance mechanism in dealing with this risk in developing countries, this paper puts forward the main application areas for climate change risk insurance and discusses the policy implications of developing climate change risk insurance in China.

Suggested Citation

  • Feng Kong & Shao Sun, 2021. "Better Understanding Insurance Mechanism in Dealing with Climate Change Risk, with Special Reference to China," IJERPH, MDPI, vol. 18(6), pages 1-14, March.
    • Handle: RePEc:gam:jijerp:v:18:y:2021:i:6:p:2996-:d:516953
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/1660-4601/18/6/2996/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/1660-4601/18/6/2996/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Walter R Stahel, 2009. "In Favour of a Proactive Insurance Approach to Climate Change," The Geneva Papers on Risk and Insurance - Issues and Practice, Palgrave Macmillan;The Geneva Association, vol. 34(3), pages 319-322, July.
    2. Huicong Jia & Donghua Pan & Jing-ai Wang & Wan-chang Zhang, 2016. "Risk mapping of integrated natural disasters in China," Natural Hazards: Journal of the International Society for the Prevention and Mitigation of Natural Hazards, Springer;International Society for the Prevention and Mitigation of Natural Hazards, vol. 80(3), pages 2023-2035, February.
    3. Jørgensen, Sisse Liv & Termansen, Mette & Pascual, Unai, 2020. "Natural insurance as condition for market insurance: Climate change adaptation in agriculture," Ecological Economics, Elsevier, vol. 169(C).
    4. R. Cremades & S. Surminski & M. Máñez Costa & P. Hudson & P. Shrivastava & J. Gascoigne, 2018. "Using the adaptive cycle in climate-risk insurance to design resilient futures," Nature Climate Change, Nature, vol. 8(1), pages 4-7, January.
    5. Donatella Porrini & Reimund Schwarze, 2014. "Insurance models and European climate change policies: an assessment," European Journal of Law and Economics, Springer, vol. 38(1), pages 7-28, August.
    6. Filomeno Mira Candel, 2007. "Climate Change and the Global Insurance Industry: Impacts and Problems in Latin America," The Geneva Papers on Risk and Insurance - Issues and Practice, Palgrave Macmillan;The Geneva Association, vol. 32(1), pages 29-34, January.
    7. Huicong Jia & Donghua Pan & Jing-ai Wang & Wan-chang Zhang, 2016. "Risk mapping of integrated natural disasters in China," Natural Hazards: Journal of the International Society for the Prevention and Mitigation of Natural Hazards, Springer;International Society for the Prevention and Mitigation of Natural Hazards, vol. 80(3), pages 2023-2035, February.
    8. Leblois, A. & Le Cotty, T. & Maître d'Hôtel, E., 2020. "How Might Climate Change Influence farmers' Demand for Index-Based Insurance?," Ecological Economics, Elsevier, vol. 176(C).
    9. David Fleming & Ilan Noy & Jacob Pastor-Paz & Sally Owen, 2018. "Public insurance and climate change (part one): Past trends in weather-related insurance in New Zealand," Working Papers 18_09, Motu Economic and Public Policy Research.
    10. Klaus Eisenack & Rebecca Stecker & Diana Reckien & Esther Hoffmann, 2012. "Adaptation to climate change in the transport sector: a review of actions and actors," Mitigation and Adaptation Strategies for Global Change, Springer, vol. 17(5), pages 451-469, June.
    11. Surminski, Swenja, 2014. "The Role of Insurance in Reducing Direct Risk - The Case of Flood Insurance," International Review of Environmental and Resource Economics, now publishers, vol. 7(3-4), pages 241-278, December.
    12. Evan Mills, 2009. "A Global Review of Insurance Industry Responses to Climate Change," The Geneva Papers on Risk and Insurance - Issues and Practice, Palgrave Macmillan;The Geneva Association, vol. 34(3), pages 323-359, July.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Sitong Yang & Shouwei Li & Xue Rui & Tianxiang Zhao, 2024. "The impact of climate risk on the asset side and liability side of the insurance industry: evidence from China," Economic Change and Restructuring, Springer, vol. 57(3), pages 1-51, June.
    2. Feng Kong & Yifei Wang, 2022. "Better understanding of climate catastrophe insurance in China: issues and opportunities, international insights, and directions for development," Natural Hazards: Journal of the International Society for the Prevention and Mitigation of Natural Hazards, Springer;International Society for the Prevention and Mitigation of Natural Hazards, vol. 114(3), pages 2969-2990, December.
    3. Yan Chen & Hao Hou & Yao Li & Luoyang Wang & Jinjin Fan & Ben Wang & Tangao Hu, 2022. "Urban Inundation under Different Rainstorm Scenarios in Lin’an City, China," IJERPH, MDPI, vol. 19(12), pages 1-18, June.
    4. Feng Kong, 2021. "How to Understand the Role of Insurance Mechanism in a Global Pandemic?," IJERPH, MDPI, vol. 18(13), pages 1-11, June.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Feng Kong, 2021. "How to Understand the Role of Insurance Mechanism in a Global Pandemic?," IJERPH, MDPI, vol. 18(13), pages 1-11, June.
    2. Feng Kong & Yifei Wang, 2022. "Better understanding of climate catastrophe insurance in China: issues and opportunities, international insights, and directions for development," Natural Hazards: Journal of the International Society for the Prevention and Mitigation of Natural Hazards, Springer;International Society for the Prevention and Mitigation of Natural Hazards, vol. 114(3), pages 2969-2990, December.
    3. Yang Wei & Tetsuo Kidokoro & Fumihiko Seta & Bo Shu, 2024. "Spatial-Temporal Assessment of Urban Resilience to Disasters: A Case Study in Chengdu, China," Land, MDPI, vol. 13(4), pages 1-24, April.
    4. Sitong Yang & Shouwei Li & Xue Rui & Tianxiang Zhao, 2024. "The impact of climate risk on the asset side and liability side of the insurance industry: evidence from China," Economic Change and Restructuring, Springer, vol. 57(3), pages 1-51, June.
    5. Huicong Jia & Fang Chen & Jing Zhang & Enyu Du, 2020. "Vulnerability Analysis to Drought Based on Remote Sensing Indexes," IJERPH, MDPI, vol. 17(20), pages 1-20, October.
    6. Weixiao Han & Chen Liang & Baofa Jiang & Wei Ma & Ying Zhang, 2016. "Major Natural Disasters in China, 1985–2014: Occurrence and Damages," IJERPH, MDPI, vol. 13(11), pages 1-14, November.
    7. Hudson, Paul & Botzen, W.J. Wouter & Feyen, Luc & Aerts, Jeroen C.J.H., 2016. "Incentivising flood risk adaptation through risk based insurance premiums: Trade-offs between affordability and risk reduction," Ecological Economics, Elsevier, vol. 125(C), pages 1-13.
    8. Hongbo Sun & Fangjing Song & Xin Ai & Yushan Duan, 2024. "Content Analysis of Disaster Risk Reduction in Secondary School Geography Textbooks in China and the United States: Promoting Disaster Resilience through Geography Education," Sustainability, MDPI, vol. 16(21), pages 1-18, October.
    9. Huicong Jia & Donghua Pan, 2017. "Tornado disaster impacts and management: learning from the 2016 tornado catastrophe in Jiangsu Province, China," Natural Hazards: Journal of the International Society for the Prevention and Mitigation of Natural Hazards, Springer;International Society for the Prevention and Mitigation of Natural Hazards, vol. 89(1), pages 457-471, October.
    10. Ximeng Xu & Qiuhong Tang, 2021. "Meteorological disaster frequency at prefecture-level city scale and induced losses in mainland China during 2011–2019," Natural Hazards: Journal of the International Society for the Prevention and Mitigation of Natural Hazards, Springer;International Society for the Prevention and Mitigation of Natural Hazards, vol. 109(1), pages 827-844, October.
    11. Qian Gong & Yushan Duan & Fengtao Guo, 2021. "Disaster Risk Reduction Education in School Geography Curriculum: Review and Outlook from a Perspective of China," Sustainability, MDPI, vol. 13(7), pages 1-16, April.
    12. Jelena M. Andrić & Da-Gang Lu, 2017. "Fuzzy probabilistic seismic hazard analysis with applications to Kunming city, China," Natural Hazards: Journal of the International Society for the Prevention and Mitigation of Natural Hazards, Springer;International Society for the Prevention and Mitigation of Natural Hazards, vol. 89(3), pages 1031-1057, December.
    13. Fang Chen & Huicong Jia & Enyu Du & Lei Wang & Ning Wang & Aqiang Yang, 2021. "Spatiotemporal Variations and Risk Analysis of Chinese Typhoon Disasters," Sustainability, MDPI, vol. 13(4), pages 1-15, February.
    14. Ilaria Colivicchi & Gianluca Iannucci, 2023. "The Environmental Responsibility of Firms and Insurance Coverage in an Evolutionary Game," Dynamic Games and Applications, Springer, vol. 13(3), pages 801-818, September.
    15. Yu Peng & Jingyi Song & Tiantian Cui & Xiang Cheng, 2017. "Temporal–spatial variability of atmospheric and hydrological natural disasters during recent 500 years in Inner Mongolia, China," Natural Hazards: Journal of the International Society for the Prevention and Mitigation of Natural Hazards, Springer;International Society for the Prevention and Mitigation of Natural Hazards, vol. 89(1), pages 441-456, October.
    16. Yu, Fangping & Xiang, Zhiyuan & Wang, Xuanhe & Yang, Mo & Kuang, Haibo, 2023. "An innovative tool for cost control under fragmented scenarios: The container freight index microinsurance," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 169(C).
    17. Peter John Robinson & W. J. Wouter Botzen & Fujin Zhou, 2021. "An experimental study of charity hazard: The effect of risky and ambiguous government compensation on flood insurance demand," Journal of Risk and Uncertainty, Springer, vol. 63(3), pages 275-318, December.
    18. Yuejuan Yang & Kun Wang & Di Liu & Xinquan Zhao & Jiangwen Fan & Jinsheng Li & Xiajie Zhai & Cong Zhang & Ruyi Zhan, 2019. "Spatiotemporal Variation Characteristics of Ecosystem Service Losses in the Agro-Pastoral Ecotone of Northern China," IJERPH, MDPI, vol. 16(7), pages 1-23, April.
    19. Belinda Storey & Sally Owen & Christian Zammit & Ilan Noy, 2024. "Insurance retreat in residential properties from future sea level rise in Aotearoa New Zealand," Climatic Change, Springer, vol. 177(3), pages 1-21, March.
    20. Nadine Gatzert & Philipp Reichel, 2022. "Awareness of climate risks and opportunities: empirical evidence on determinants and value from the U.S. and European insurance industry," The Geneva Papers on Risk and Insurance - Issues and Practice, Palgrave Macmillan;The Geneva Association, vol. 47(1), pages 5-26, January.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jijerp:v:18:y:2021:i:6:p:2996-:d:516953. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.