The non-structural strategy of insurance in developed countries to adapt to climate change

The rapid growth of industrial activities and as a result the increase of greenhouse gases in the last few decades has caused the disturbance of the global climate balance, which is referred to as the phenomenon of climate change. The negative effects of this phenomenon may intensify in the future due to society's attitude towards the rapid development of industry and less attention to the environment. There is a lot of evidence that these changes are happening; Adapting to climate change includes a set of management measures to reduce harmful consequences and benefit from it. Mitigating measures include reducing greenhouse gas emissions, promoting and expanding clean technologies, and protecting forests to deal with climate change; these are necessary even though these actions will slow down the occurrence of climate change, they are not able to halve or reverse the process of this phenomenon in the future. Therefore, in the medium term, society needs a specific strategy to adapt to the expected changes. Adapting to climate change is based on a better and more appropriate understanding of the effects of climate change and making informed decisions in taking measures to deal with this phenomenon. Adaptive strategies with the effects of climate change include a wide range, some of which are non-engineering or non-structural (education and insurance) and some are engineering or structural (such as structural measures and changes in management style).Insurance is one of the main methods of non-structural adaptation, and in a situation where this trend is increasing due to the growing trend of the harmful effects of greenhouse gases and the intensification of the effects of climate change, paying attention to the experiences of developed countries and adapting to the existing conditions of the country in line with the attention It is very important to have insurance products compatible with climate change that are also compatible with the country.

The research method considered in this article is based on the qualitative research method, and first, scientific reports and related sources were extracted, and the experiences of countries were extracted by examining written documents and using a comparative approach. To present the results, the extracted outputs were analyzed into three main classes of general understanding of the effects of climate change, insurance, and product development. The United Nations Development Program (2021) includes an index called HDI to determine the development of countries. This index is determined based on education, health, lifestyle, etc. The numerical value of this index varies between zero and one, and for developed countries, a value higher than 0.8 is considered. In this article, the value of this index based on the statistics of 2021 is the basis for the division of developed countries, and among the developed countries, Spain, Great Britain, Italy, Iceland, Belgium, Turkey, Romania, Sweden, Finland, Malaysia, New Zealand, Australia, Austria, Canada, France, Japan, Norway, Bulgaria, Germany, Denmark and the United States of America were considered as selected countries.

Climate change is one of the main challenges of the last century. With the formation of the Intergovernmental Panel on Climate Change at the international level, comprehensive policies in this field were taken into consideration and studies related to investigating the effects, relief, and adaptation to climate change were expanded. Structural and non-structural approaches are the two main approaches to adapting to climate change, and the current research is trying to use an adaptive approach, which is part of the non-structural strategy based on climate change risk management and centered on "insurance".The results showed that in general, the emission of more than half of the greenhouse gases in the world occurs in developed countries and their share of insured losses is higher, and also the governments in these countries seek to understand the general trend of the effects of climate change and respond to it. Therefore, examining the experiences of these countries in the field of providing solutions to face climate change is considered necessary and useful. These ongoing solutions include insurance plans and coverages, climate change risk management strategies in insurance, climate change risk transfer methods in insurance, and insurance products tailored to climate change.

The first step regarding the general understanding of the risk of climate change is to know the effects of climate change and especially the threats caused by climate change in the field of natural hazards and consequently the threat to the insurance industry. From this point of view, developed countries have experienced a favorable situation, which has become a platform for additional experiences in the field of insurance and product development in the face of climate change. Therefore, examining the experiences of these countries in the field of providing solutions to face climate change is considered necessary and useful. These ongoing solutions include insurance plans and coverages, climate change risk management strategies in insurance, climate change risk transfer methods in insurance, and insurance products tailored to climate change. Providing insurance products suitable for catastrophic events, including optional coverage especially for storms and floods, providing insurance for agricultural products or high-risk product insurance, comprehensive legal mandatory insurance against damages caused by natural hazards, creating a national solidarity fund with the aim of financial support for damage prevention. Providing insurance incentives for preventive measures, green loans for financial support of adaptation measures are among the most important and widely used plans and insurance products reviewed in selected developed countries.