Strengthening resilience: PIISA Project calls on insurance sector to address climate risks

The three-year Piloting Innovative Insurance Solutions for Adaptation (PIISA) project concluded in May 2026. Among other topics, the project explored how the insurance sector can safeguard its business operations while accelerating climate change adaptation in the face of growing climate risks. The PIISA project implemented five pilots related to green roofs, agriculture and forestry, soil changes, and wildfires across various European countries. The project was coordinated by the Finnish Meteorological Institute and funded by the Horizon Europe program.

Tyrsky led the project’s communications, interaction, dissemination of research results, and stakeholder engagement. The project’s outputs included policy recommendations and fact sheets on the findings, organizing events for different stakeholders, and facilitating policy dialogues. Additionally, a white paper tailored for the insurance sector was published in February 2026, offering insights and recommendations on incorporating climate risks into the industry based on the project’s research results.

In addition to communications and interaction, Tyrsky made a strong contribution to the project’s research: expert Adriaan Perrels was involved in mapping Europe’s current insurance portfolios and drafting a review on the role and potential of insurance in accelerating climate change adaptation. Perrels is currently finalizing an article on how the availability and sharing of data affect the pace of development and adoption of insurance innovations.

White paper proposes ways for the insurance industry to better address climate change

The results of the PIISA project pilots confirm that insurance can be used to support climate change adaptation. Indeed, damages and long-term costs caused by climate change can be mitigated by linking insurance premiums and terms to more sustainable land use, nature-based solutions, or protective structures built into buildings.

Insurance companies can also utilize forecasts on the impacts of climate change and factor adaptation measures into their assessments of product pricing and profitability. According to the PIISA project, companies should develop innovative insurance products that incentivize climate risk reduction and explore the implementation of parametric insurance. Compared to traditional indemnity insurance, parametric models can reduce administrative costs and improve the policyholder’s liquidity, for example, following storm or flood damage.

“It is possible to strengthen our society’s climate resilience through insurance solutions,” says Kati Berninger, Research Director at Tyrsky. “Moving forward, stronger cooperation is needed between the public sector, policy guidance, and insurance companies.”

According to the PIISA project, in addition to closer cooperation, there is a need for harmonized regulation of insurance products, more freely accessible data on damages and vulnerabilities, and clearer consideration of vulnerable groups in product pricing.

Read the insurance sector white paper here.