Master's Series Prevention is better than cure: insurance-led loss prevention

Climate change is intensifying extreme weather events, driving a surge in insurance claims. In response, many insurers are raising premiums, narrowing coverage, or withdrawing from high-risk markets entirely. This creates protection gaps: the shortfall between actual losses and what insurance policies ultimately cover.

 

Traditional insurance mechanisms - such as risk-based pricing, exclusions, warranties, and claims payments - are not always effective in preventing losses and can even widen protection gaps. Alternative approaches, including government-backed public–private insurance partnerships, parametric insurance, and catastrophe (cat) bonds, can help reduce protection gaps but these structures do little to address the underlying risk of loss itself.

 

Effective loss prevention is essential to maintain insurability, preserve markets, and ensure long-term commercial viability. In this webinar, I will propose two insurance-led solutions at the individual contract level: 1. knowledge-sharing on loss prevention and preparedness; and 2. advance financing for policyholder-level loss prevention measures. I will explore how existing insurance law principles - such as the indemnity principle, the marine duty to sue and labour, and subrogation - can support or be adapted to enable these loss prevention arrangements.

 

Key learning points:

• The limitations of conventional property and casualty insurance in relation to natural catastrophe risks
• Insurance protection gaps: causes and impacts
• The limitations of traditional contractual risk control tools
• How insurance public private partnerships, parametric insurance and cat bonds can reduce protection gaps
• Leveraging insurance contracts for loss prevention: knowledge-sharing and loss prevention financing
• Making legal principles do the work on loss prevention

 

Bio: Dr Franziska Arnold-Dwyer is an Associate Professor at UCL and a qualified solicitor. She teaches and researches in insurance law, insurance regulation and reinsurance law. She is the editor of ‘The Law of Reinsurance and England and Bermuda’ (6th edn, Sweet & Maxwell, 2024) and one of the editors of ‘MacGillivray on Insurance Law’ (16th edn, Sweet & Maxwell, 2025) - both leading textbooks that have been cited in court. Her books 'Insurance, Climate Change and the Law’ (Routledge, 2024) and ‘Insurable Interest and the Law’ (Routledge, 2020) have won prizes. Franziska sits on the Presidential Council of the International Insurance Law Association (AIDA), is a committee member of the British Insurance Law Association (BILA), and is a Freeman of the Worshipful Company of Insurers. She assisted the Law Commission on their insurance law reform project and has given evidence on insurance regulation in Parliament.

 

My key publications on the topic are:

• Insurance, Climate Change and the Law (Routledge, 2024)
• 'Using Insurance for Natural Hazard Loss Prevention' in D. Kysar and E. Lim (eds.) The Oxford Handbook of Climate Change and Private Law (OUP, 2026)
• 'Insurance public private partnerships for natural catastrophe risk’ in M. Sonnentag, J. Gal, and P. Reusch (eds.), Versicherungsrecht, Haftungs- und Schadensrecht (Verlag Versicherungswirtschaft, 2025)
• Regulating sustainable insurance products for consumers (2025) 8 Journal of Business Law 662
• Towards a European system for natural catastrophe risk management? (2025) 5 Zeitschrift für Versicherungsrecht (ZVers) 201
• A Legal Framework for Net Zero Aligned Insurance Products (2023) 29(2) Connecticut Insurance Law Journal 1