Traditional indemnity-based insurance solutions

One such example of a nature-based solution can be found on the island of Texel - a World Heritage Site in the Netherlands, which attracts one million visitors each year. It is considered the world’s largest tidal flat system and is protected by the Prince Hendrik Sand Dyke. To mitigate the risk of rising sea levels and avoid any danger of major failure, local authorities looked for an innovative concept which came from a dredging company. It placed five million cubic meters of sand and planted two million marram grasses to create a landscape gradient that not only protected the dyke from erosion but enhanced the local natural habitat. The project also delivered an additional EUR 1 million benefits in fish production, climate regulation and water quality regulation. The dredging company purchased a Construction All Risks insurance policy from Swiss Re, which also protected the municipality, the water management agency, engineers and contractors against delivery delays and failures.

People living in flood-prone areas of the United Kingdom increasingly struggled to afford an insurance cover. In order to address this flood protection gap at a national level, the UK government and the insurance industry created Flood Re, a public-private partnership with the aim of providing affordable insurance to homeowners living in areas with higher flood risk. Flood Re transfers part of its risk to Swiss Re, which enables the flood insurance to remain affordable for the population living in areas at risk of flooding and sets the conditions for the creation of a free market.