The effect of disaster insurance on community resilience: a research agenda for local policy

The risk of climate disasters has spurred increased interest in public policies that help expand the number of households with disaster insurance, particularly for financially vulnerable populations. In recent years, local governments, concerned with their community’s resilience to climate disasters, have started to consider insurance programs as part of their adaptation strategies. However, we do not yet have a robust body of research that shows if, and how, expanded insurance take-up among households affects community-wide recovery after a climate disaster. Filling this disaster insurance research gap will better equip public sector leaders to assess if investments in insurance programs can further community resilience goals and when disaster insurance is an appropriate climate adaptation tool. In this article, we assess the state of empirical evidence through existing frameworks of community recovery and put forward an agenda for future research that is attuned to local policy needs.Key policy insights: There is increasing interest by policymakers in expanding the number of households with disaster insurance to provide financial protection in the face of increasing climate risks, but little evidence exists on how household-level insurance affects community-level resilience outcomes.Expanded research on this topic could support local decision-makers in designing effective and efficient policies to support community recovery from climate extremes.Future research should focus on testing more holistic disaster recovery measures and downscaling global and national research to the local scale.Emerging pilot insurance programs and experimental policies offer novel opportunities to study impacts at the local level.