approaches based on historical data and use risk assessment models instead. This was actually made mandatory in Florida after Hurricane Andrew in 1992. Second, the increase in the probability of occurrence of extreme events and the potentially higher correlation between risks make default risks greater for insurers and _in fine_ for reinsurers, eventually justifying higher level of reserves. The insurance sector is very highly regulated in all countries, and these changes will lead to modifications of these regulations. In some countries, the central (or local) government is also a stakeholder in the insurance or reinsurance sector. This is the case in France with the CAT-NAT system in which the government is responsible for losses linked to most natural disasters (with the notable exception of storms), as well as in Florida where the public insurer, Citizens, has a large share of the market, following the withdrawal of a large number of private insurers unable to face ever-increasing risks.

**More generally, insurance can also be considered as a tool for adaptation.** In particular, a high penetration of insurance allows economic stakeholders affected by a disaster to rebuild more rapidly and to avoid bankruptcies (particularly small businesses), and to therefore get the economy back on its feet more rapidly, limiting indirect economic losses (see an example on Mumbai in Ranger et al., _forthcoming_ ). Moreover, the presence of insurance (particularly for operating costs) enables stakeholders to proceed with reconstruction in a more peaceful atmosphere and to therefore seize improvement opportunities, i.e., to reconstruct "better" rather than reconstructing "identically".  Finally, access to insurance against natural risks also allows some stakeholders to take higher risks as a result of the fact that it is shared and transferred to stakeholders who can handle it.  The risk can appear as a production factor, making it possible to strengthen the producers' position.  Thus, better risk distribution, thanks to insurers, increases the economy's ability to make the changes necessary to adapt to climate change.

**In theory, if insurance rates were representative of the risk level in a given area, access to insurance could also be used to provide information on their level of risk to businesses and households. This information would be communicated in the form of a price signal that they are not necessarily able to evaluate for themselves.** This is not the case in France today where insurance rates for natural disasters are identical in all areas, at-risk or not. However, the idea of insurance rates determined in relation to risk level is controversial. Basically, the transition from a fixed-rate system to a system where rates are based on risk level is complex since it could lead to very steep price increases whose political acceptability is uncertain. Moreover, even outside of the transition phase, insurance rates directly related to risk level can lead to difficulties for the poorest households that sometimes settle in the highest risk zones where real estate costs are lower.  An increase in insurance rates could therefore eliminate this possibility, leading to the absence of insurance or increased difficulty in finding housing.

**In general, the question of natural risk insurance cannot be separated from questions of access to housing, the cost and availability of real estate and land-use planning.** The example of Florida shows that insurance rates that are strictly determined by the level of risk can endanger the economic viability of some regions, with highly negative consequences for the populations concerned.  Moreover, hazard-prone areas are not only associated with private advantages (such as a view of the sea), but also provide collective benefits (as in the case of port areas that are at risk but that make it possible to decrease the cost of imports for the population as a whole, like in the case of New Orleans).  Mixed solutions that take account of the risk level to create price signals while maintaining a high level of national solidarity can be considered in order to reconcile these different requirements.  However, these measures could only be initiated if they are highly consistent with land-use policies and, particularly, with zoning policies (i.e., the definition of hazard-prone areas in which limitations on construction apply).

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