PIISA stands for “Piloting Innovative Insurance Solutions for Adaptation” and brings together 12 organisations from 5 European countries. The aim is to co-develop climate resilient insurance portfolios, as well as develop solutions for sharing climate-related risk and losses data. The focal sectors benefiting from the project are agriculture, forestry, cities and citizens’ well-being. The objectives include
Preparing and Planning for Climate Resilience: Providing a better understanding of climate change enhanced risks and the division of tasks between adaptation driven risk reduction and risk sharing, we can better prepare and plan for Climate Resilience. This means providing additional open access to risk data, replicable insurance concepts, and related context-sensitized business models.
Accelerating Transformations towards Climate Resilience: Through a S.M.A.R.T replication system, the PIISA project aims to accelerate transformations leading to climate resilience. Innovations will be transferred to other eligible sectors, and to other regions and countries in the project, as well as beyond the project’s scope. This will be possible with the extensive customer base of the 3 insurance companies involved in PIISA, and the current collaboration with parallel projects and key stakeholders.
Demonstrating Systemic Transformations to Climate Resilience: The PIISA Project will show the feasibility and effectiveness of recently initiated insurance products by demonstrating how it impacts the systemic transformations to climate resilience. It will present and highlight the potential for additional innovations elaborated in the project.
SFO’s primary role in PIISA has been the development of the Clay Shrink Swell Building Damage Assessor (CSSBDA). This is a on online website designed to educate homeowners about their financial risks associated with inadequate insurance cover for property damage caused by clay shrink swell (CSS) events.
A CSS event can occur if the relevant local factors are present and are combined with the relevant climate factors. Clay soil consistency can easily change depending on the soil’s water content. When it rains, clay soils absorb water and dilate just like a sponge. The water contained in the clay evaporates and the clay soil shrinks. The drying out of the soil creates both horizontal cracks on the surface and vertical hydromechanical settlement under the weight of the structures. Simply put, CSS events occur when a drought is followed by heavy rain, causing soil to move and change shape significantly in a short period of time.
CSS events mainly affect single-family homes and are widespread in France. It is estimated that 48% of the national territory is at medium or high risk of this phenomenon and around 10.4 million single-family homes are at medium or high risk of CSS events, representing 54% of all single-family homes.
If a homeowner suffers property damage caused by a CSS event, insurance cover is provided by the typical multi-risk home insurance policy together with the Cat Nat scheme. However, an insurance payout will only take place when the State officially recognises the occurrence of a natural catastrophe under the Cat Nat mechanism. Where there has been damage caused by a CSS event but there is no State recognition of a natural catastrophe, there is no insurance payout. Even if a natural catastrophe is recognised by the State, there will be no insurance payout if the homeowner has not complied with all preventative measures which are applicable for the property and articulated in the natural risk prevention plan (PPRN). And furthermore, even if a natural catastrophe is recognised by the State, the length of time to receive State recognition of a natural catastrophe (and the consequent length of time to receive compensation) is challenging for homeowners as it prolongs their recovery process and adds to their financial burden.
In this context, the objective for the CSSBDA is to shine a light on this issue and empower homeowners to take steps to reduce the financial risks associated with inadequate insurance cover.
Key figures :
48% of French national territory is at medium or high risk of CSS events
10 million homes (representing 54% of all single family homes)
50% of instances of property damage caused by ground movement in the last 9 years which have not received compensation
David Cooke
Law and policy Lead
David is a lawyer by training and specialises in sustainable finance and the intersection of research, policy and regulation. He has worked across international trade, emerging market finance and climate change consulting and holds a Master’s in Sustainable Development. He previously worked at ClientEarth, the UK-based public interest law firm, where he focused on regulatory and legal strategies to improve corporate and investor transparency on climate-related financial risk, and engaged with financial regulators and government departments to strengthen oversight and accountability. He joined the Sustainable Finance Observatory in 2019 and provides cross-cutting support to research programmes on legal and policy implications.
Ana Rivera Moreno
Senior Sustainable Finance Analyst
Ana is a Senior Analyst working on sustainable finance within the retail and impact team. She holds Master’s degrees in Economics and in Public Policy and Development from the Paris School of Economics, following earlier training in Economics at the National University of Colombia. Before joining the Observatory in 2022, she worked at the OECD and held analytical roles in Colombian public institutions, including the Ministry of Trade and the National Planning Department, where she contributed to empirical analysis and policy work on labour markets, industrial development, productivity, and inclusive growth. At the Observatory, she leads and contributes to quantitative and qualitative analysis, survey-based research, and the development and maintenance of MyFairMoney.