Natural hazard insurance outcomes at national, regional and local scales: A comparison between Sweden and Portugal

This study addresses the role of natural hazard insurance in two European countries with different insurance markets and socioeconomic conditions: Sweden and Portugal. The analyses were conducted at the national, regional (Southern Sweden and Lisbon Metropolitan Area - LMA), and local (Malmo and Lisbon cities) scales. Most damage caused by weather and climate-related (WCR) hazards during the 1980-2019 period was not covered by insurance companies in Sweden (71%) and Portugal (91%). An insurance affordability analysis was performed using income for the national and regional scales. Unaffordability is higher in Southern Sweden than in LMA, implying that better socioeconomic conditions do not necessarily mean a higher average capacity to pay for insurance. At the local scale, urban flooding was analysed for Malmo (1996-2019) and Lisbon (2000-2011) using insurance databases, in which the most relevant 21st century rainfall events for each city are included (2014 and 2008, respectively). The influence of terrain features on flooding claims and payouts was determined using Geographic Information Systems (GIS) spatial analyses. The flat Malmo favours ponding and extensive flooding, while the distance to the drainage network and flow accumulation are key factors to promote flooding along valley bottoms in the hilly Lisbon. Flooding hotspots tend to result from a combination of higher depths/lower velocities (accumulation of floodwaters and ponding) and not from a pattern of lower depths/higher velocities (shallow overland flow). More detailed data on insurance, flooding, and socioeconomic conditions, at regional and mainly local scales, is needed to improve affordability and urban flooding risk assessments.

Automated summary

This study examines the role of natural hazard insurance in Sweden and Portugal, showing that a large portion of weather and climate-related damage was not covered by insurance. It also analyzes the affordability of insurance in different regions and explores the impact of terrain features on flooding. More detailed data on insurance, flooding, and socioeconomic conditions are needed for better risk assessments.