Understanding Risk Forum

This online session is jointly organised by the Firelogue and Naturance projects and establishes a joint insurance working group. The session explores public and private insurance strategies that support nature-based solutions (NBS) for reducing the escalating risks of wildfires. NBS are cost-effective solutions that are inspired and supported by nature and simultaneously provide environmental and socio-economic benefits and boost resilience. A consensus is emerging that restoring the forest ecology through NBS, such as prioritising fire-resistant vegetation, enabling grazing by herbivores in areas facing land abandonment, prescribed burns, and restricted development in wildlands, can reduce the risk of extreme wildfires. This paradigm shift away from fire suppression towards a fire loss-prevention strategy is urgently needed, and risk financing strategies can untap potential for promoting NBS. Public and private insurers can support such measures, for example by providing protection in case of damages from livestock grazing or to those carrying out prescribed burns and giving discounts to forest owners that pursue ecological practices and to land and homeowners prioritising fire resistant vegetation on their land, along with raising rates to developers in the wildland-urban interface. This will require a strong role for the public sector – either operating as insurers, as public-private partnerships or providing the regulatory incentives for the private sector to incentivise NBS. This session will explore i) NBS options for wildfire risk management and ii) insurance or other risk-financing strategies/products (e.g. parametric) that could support wildfire risk management.