Governing Climate Change Adaptation Through Insurance: Complexity, Risk and Justice Concerns?

Climate adaptation has not kept pace with climate impacts which has formed an adaptation gap. Increasingly insurance is viewed as a solution to close this gap. However, the efficacy and implications of using insurance in the climate adaptation space are not clear. Furthermore, past research has focused on specific actors or processes, not on the interactions and interconnections between the actors and the processes. I take a complex adaptive systems approach to map out how these dynamics are shaping adaptation and to interrogate what the insurance climate adaptation literature claims are the successes and pitfalls of insurance driving, enabling or being adaptation. From this interrogation it becomes apparent that insurance has enormous influence on its policy holders, builds telecoupling into local adaptation, and creates structures which support contradictory land use policies at the local level. Based on the influence insurance has on policy holders, I argue that insurance should be viewed as a form of governance. I synthesize insurance, governance and adaptation literature to examine exactly what governance tools insurance uses to exercise this influence and what the consequences may be. This research reveals that insurance may not be the exemplary adaptation approach the international community is hoping for. Using insurance, risk can be reduced without reducing vulnerability, and risk transfer can result in risk displacement which can reduce adaptation incentives, fuel maladaptation, or impose public burdens. Moreover, insurance requires certain information and legal relationships which can and often do structure that which is insured to the needs of insurance and shift authority away from governments to insurance companies or public-private partnerships. Each of these undermine the legitimacy of insurance-led local adaptation and contradict the stated social justice goals of international calls for insurance. Finally, I interrogate the potential justice concerns that emerged through an analysis of insurance as a form of adaptation governance. Using a multi-valent approach to justice I examine a suite of programs intended to support agricultural adaptation through insurance. This analysis demonstrates that although some programs clearly attempted to consider issues of justice, overall these existing programs raise distributional, procedural and recognition justice concerns.