Insurability and Mitigation of Flood Losses in Private Households in Germany

Thieken, Annegret H.; Petrow, Theresia; Kreibich, Heidi; Merz, Bruno

doi:10.1111/j.1539-6924.2006.00741.x

Cited by 189 publications

(165 citation statements)

References 17 publications

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“…In the light of these results it seems that physical flood mitigation measures and financial flood insurance policies are not seen as perfect substitutes, and indeed they partly cover different risks, as discussed before. Similar results (comparably high mitigation behaviour among insured households) are found in other studies for the German context (Thieken et al 2006) and in the USA for wind storm mitigation/insurance (Carson et al 2013;Chatterjee and Mozumder 2014;Petrolia et al 2013). …”

Section: Moral Hazard Effectssupporting

confidence: 77%

“…For the Netherlands, Botzen et al report a higher self-reported willingness to invest in the elevation of a new house if the respondent is also willing to pay for flood insurance . For flood-prone areas in Germany, it seems that insured households take more private flood mitigation measures than non-insured, not less (Thieken et al 2006). Turning to the effect of expected government relief, some authors indeed report negative correlations with private mitigation (Botzen et al 2009;Grothmann and Reusswig 2006;Kreibich et al 2009).…”

Section: Literature Reviewmentioning

confidence: 95%

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The determinants of private flood mitigation measures in Germany — Evidence from a nationwide survey

Osberghaus

2015

Ecological Economics

137

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Die Dis cus si on Pape rs die nen einer mög lichst schnel len Ver brei tung von neue ren For schungs arbei ten des ZEW. Die Bei trä ge lie gen in allei ni ger Ver ant wor tung der Auto ren und stel len nicht not wen di ger wei se die Mei nung des ZEW dar.Dis cus si on Papers are inten ded to make results of ZEW research prompt ly avai la ble to other eco no mists in order to encou ra ge dis cus si on and sug gesti ons for revi si ons. The aut hors are sole ly respon si ble for the con tents which do not neces sa ri ly repre sent the opi ni on of the ZEW. AbstractPublic flood protection cannot totally eliminate the risk of flooding. Hence, private mitigation measures which proactively protect homes from being flooded or reduce flood damage are an essential part of modern flood risk management. This study analyses private flood mitigation measures among German households. The dataset covers more than 6000 households from all parts of the country, including flood plains as well as areas which are typically not at a high risk of riverine flooding. The results suggest that the propensity to mitigate flood damage increases i.a. with past damage experience and damage expectations for the future. The latter effect can be interpreted as a 'climate adaptation signal' in the flood mitigation behaviour. All other factors remaining equal, a strong belief in a climate-change-induced increase of personal flood damage in the next decades induces an increase of the probability of flood mitigation by more than 10 percentage points. Moreover, strong evidence for moral hazard effects in the flood mitigation behaviour cannot be observed. Households expecting insurance coverage do not reduce their mitigation efforts. Likewise, the expectation of government relief payments hinders mitigation only for some groups of households.

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Section: Moral Hazard Effectssupporting

confidence: 77%

Section: Literature Reviewmentioning

confidence: 95%

The determinants of private flood mitigation measures in Germany — Evidence from a nationwide survey

Osberghaus

2015

Ecological Economics

137

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“…8 Botzen and van den Bergh (2008). 9 Thieken et al (2006 of flood insurance, the government also provided ad hoc disaster relief after several major flooding events, such as during the 2002 floods, which caused about h9.2 billion of damage. This government relief may reduce the demand for private insurance and it has been argued that the parallel administrative procedures of government relief and insurance after a flood can be time-consuming and inefficient.…”

Section: General Characteristicsmentioning

confidence: 99%

A Comparative Study of Public—Private Catastrophe Insurance Systems: Lessons from Current Practices

Paudel¹,

Botzen²,

Aerts³

2012

Geneva Pap Risk Insur Issues Pract

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Natural disasters risk is increasing in several regions around the world as a result of socioeconomic development and climate change. This indicates the importance of establishing affordable and sustainable natural disaster risk management and compensation arrangements. Given the complexity of insuring extreme risks, insurers and governments often cooperate in catastrophe insurance systems. This paper presents a comparative study of the main components and a broad range of indicators of fully private and fully public, as well as public-private (PP) insurance systems, for extreme events, in ten countries. This analysis results in the following nine main recommendations for policymakers who aim to establish new, or improve existing, insurance arrangements for natural disasters: (1) mandatory participation requirements are advisable to achieve a high market penetration rate; (2) adequate monitoring and enforcement mechanisms need to be put in place to ensure compliance with these requirements; (3) the government needs to take responsibility for part of the (extreme) damage in order to keep an insurance system financially viable and affordable; (4) private insurance companies should participate in a PP insurance scheme by selling and administering policies and by covering medium-sized losses; (5) the integration in systems of risk transferring mechanisms is advisable; (6) it is advisable that governments stimulate the building-up of insurers' reserves by providing tax exemptions; (7) risk mitigation policies should be carefully integrated in a natural disaster insurance system; (8) a detailed assessment and mapping of risk provides the basis for an effective mitigation policy; (9) insurance should provide financial incentives for policyholders to take risk mitigation measures.

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“…While several studies have found that increased knowledge and information correlate positively with precautionary behaviour (Thieken et al 2006, Miceli et al 2008, numerous studies found no evidence of a direct effect of information sources and flood adaptation behaviour when risk perception was controlled for (Zaleskiewicz et al 2002, Grothmann and Reusswig 2006, Botzen et al 2009). …”

Section: Protection Motivation Theory and Literature Reviewmentioning

confidence: 99%

The impact of flood action groups on the uptake of flood management measures

et al. 2016

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Household flood management measures can significantly reduce the risk from flooding. Understanding the factors that influence the uptake of measures has important implications for the design of measures to induce people to take charge of risk mitigation. We investigate the impact of flood action groups in communities in Scotland on the uptake of four measures: insurance, flood warnings, sandbags and floodgates applying regression analysis using a cross-sectional survey (n = 124). The groups were formed in response to the threat from flooding in those communities, and offer information and training on household flood management measures. We use the theoretical framework of Protection Motivation Theory, and compare uptake of the measures before and after the foundation of the flood action groups, as well as in the near future. The models show positive adoption effects for flood warnings, floodgates and to an extent for insurance, and a positive correlation with increased confidence of implementing and belief in the effectiveness of the measures. The effect is significant if specific information on the measures was provided, indicating the importance of Climatic Change (2016)

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Insurability and Mitigation of Flood Losses in Private Households in Germany

Cited by 189 publications

References 17 publications

The determinants of private flood mitigation measures in Germany — Evidence from a nationwide survey

The determinants of private flood mitigation measures in Germany — Evidence from a nationwide survey

A Comparative Study of Public—Private Catastrophe Insurance Systems: Lessons from Current Practices

The impact of flood action groups on the uptake of flood management measures

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