$1,000 Grand Prize: Mitigating Risks to Vulnerable Populations

Insurance for Risks of Climate Change

Last Edited by Lawrence P.

Product Name: Climate Defender Policy
Populations that product/service would protect: Lower income populations are the most vulnerable to natural disasters brought on by climate change, such as hurricanes, tornados, wild fires, flooding and arctic blasts. Not only are their living and working situations most likely to be impacted by natural disasters, this population typically lacks the financial resources to quickly bounce back.
Impacts that the product/service would protect against: The Climate Defender Policy is not intended to replace a comprehensive homeowners policy. Instead, this policy can be sold to to individuals and even small businesses to automatically pay out a small amount of coverage ($10K) when they are impacted by a natural disaster precipitated by climate change. The idea is that this coverage helps them pay for emergency supplies, small repairs, a generator or water pump, temporary relocation, or offset any temporary income loss.
Trigger event that would result in a claim: Coverage payouts could be automatically triggered if their residence or business falls within a designated disaster zone, for example if located within a wildfire burn zone, or if the wind speed of a major hurricane or tornado is measured to hit a specific level in their immediate geography.
Scope and nature of the insurance response: Ideally this modest amount of coverage would be priced as an automatic cash payout, but it could also include other resources, such as deployment of emergency kits, temporary relocation assistance, and guidance for expedited clean-up, repairs, or restoring utilities.
Thoughts on why this would be a compelling product: For the policy holder audience, those who need help the most in the aftermath of a natural disaster typically lack any safety net, and this is an opportunity to provide that for an affordable premium. For insurers, this product provides an opportunity to expand their reach beyond property owners, and also price a product which addresses the increasingly volatile risks of climate change.
Thoughts on how this product would be sold: This product could be promoted by big box retailers (e.g. Home Depot, Lowes, Menards, Costco, Sam's Club, Walmart), since a significant percentage of payouts might be redirected to them, and they have the logistical resources to deliver emergency supplies and other materials for post-disaster repairs.

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Idea No. 2187

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