Financial expert: Financing climate damage - Why compulsory insurance is necessary

Financial expert: Financing climate damage - Why compulsory insurance is necessary

According to a report by taz.de, large parts of northern and eastern Germany are still under water. Insurers' damage statistics show that thunderstorms in Europe and North America last year caused more damage than ever before. Such events will increase and the climate crisis will be visible and tangible for everyone. A discussion about financing climate damage is urgently needed, as absolute protection against damage caused by extreme weather events will not be possible.

The introduction of compulsory insurance for all buildings that pays for climate damage would be a quick measure for financial security in times of climate crisis. The premiums would be affordable through the contributions of all insured persons. The federal states are pushing for such a solution, while the federal government remains inactive because the FDP does not want compulsory insurance. However, the federal government's fatal refusal could be avoided if the federal states independently introduce compulsory insurance.

The introduction of compulsory insurance would have an impact on the insurance market by requiring all building owners to insure themselves against climate damage. This would increase financial security in times of climate crisis. It could also lead to increased competition among insurance companies to offer affordable premiums. For consumers, this means mandatory insurance against climate damage, but also greater security in the event of natural disasters.

Overall, the introduction of compulsory insurance is an important step towards financing climate damage, as it can help distribute the financial burden more fairly and strengthen resilience to the impacts of the climate crisis. This highlights the urgent need for a plan to finance climate damage.