EU to launch climate insurance scheme after summer of extreme weather

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The European Union will ‌create a "climate insurance alliance" to increase cover for extreme weather events, European Commission President Ursula von der Leyen said on Wednesday, as the bloc emerges from a summer of drought, wildfires and heatwaves.

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According to EU figures, ​only a quarter of the climate-related economic losses in the bloc are insured. Its new ​scheme would bring together insurers, investors, risk modellers, public authorities and insurance takers to work on increasing insurance uptake.

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The alliance ​will identify and promote instruments that could reduce risk — such as group insurance or parametric insurance, under which ‌payouts ⁠are triggered automatically when predefined thresholds such as rainfall levels or temperatures are breached.

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She also promised other proposals. A "climate resilience" strategy, due in October, on how to manage climate risks in 100 vulnerable European territories. A heatwave plan will aim to improve early warning ⁠systems, and ​an EU water plan will work to increase drought ​risk management.