Our work in this project

Agriculture Pilot-related Market Review - BSC will conduct an agriculture pilot-related market review, examining the challenges, barriers, and opportunities to reduce the climate-related insurance protection gap. We will analyse the supply and demand for such insurance and address drivers of insurance protection gaps.

Actuarial Risk Modelling – State-of-the-art, Challenges and Innovation Potential - BSC will review the existing actuarial and catastrophe models that are used in the insurance industry to assess climate-related risks and inform the design of insurance products. 

Technical Requirements for Pilots - For climate service and insurance product development, BSC will identify and develop one or two agro-climatic indicators based on seasonal climate predictions for the agriculture pilot.

Co-development of Services for Pilots - We will contribute to the co-design and co-development of the services by engaging with Mediterranean farmers.

Food and Agriculture Pilot - The pilot would be carried out in three loops. The aim of Loop 1 is to measure the market potential of weather insurance and derivatives in Finland. The second loop aims to gain insight into the potential replicability of Loop 1 over the European region with climatic conditions different to Finland. Based on Loops 1&2, Loop 3 will involve operationalizing the climate services co-developed in the previous two loops and further extending it to the European level.

Why is this work relevant?

Climate adaptation consists of risk reduction and risk sharing. Specifically, risk sharing can be an essential building block, as it allows for the feasible distribution of risk among various stakeholders. Given the need to significantly increase adaptation efforts in Europe and elsewhere, the role of risk-sharing services should be boosted by making them smarter, easier to adopt, widely applicable, affordable, and transparent.

In light of this, the PIISA project aims at developing innovative context-sensitised insurance products, while promoting a virtuous interaction between risk sharing and risk reduction. The envisaged insurance products in PIISA will be new in three ways: (1) they will employ novel or yet scarcely used risk-sharing mechanisms, (2) they will use new climate risk data services, and (3) they will allow smart interaction with adaptation efforts resulting in more overall resilience.