Insuring Extreme Heat Risks: Scoping the potential for insurance innovation to support heat mitigation and response



Berkeley Law: Center for Law, Energy, and the Environment




This policy report assesses the potential for risk transfer mechanisms, including insurance-based or other financial instruments, to address the local government, public health system, community, and other costs of climate change-related extreme heat while promoting risk-mitigating investments. Section I provides an overview of extreme heat event impacts and analysis, the investments that can be made to mitigate them, and the public benefits of those investments. Section II reviews a range of leading local and regional heat mitigation plans and initiatives. Section III briefly identifies legal considerations for extreme heat preparation, response, and risk transfer in California. Section IV identifies existing insurance and risk transfer innovations that may be applied to climate change related risks and natural infrastructure-based mitigation. Section V identifies the key determinants of feasibility for a potential extreme heat risk transfer and mitigation framework and outlines complementary mechanisms that could form such a framework; Section VI proposes potential models for this framework; and Section VII offers a set of policy, research, and collaborative next steps for local governments, insurance, and public health leaders.

Climate Impact Tags

Extreme heat

Adaptation Planning Guide Phases

Phase 2: Assess Vulnerability Phase 3: Define Adaptation Framework and Strategies Phase 4: Implement, Monitor, Evaluate, and Adjust

Resource Type Tags

Planning and policy guidance


Extent: California


Last updated: Aug. 11, 2022