Moving towards a Natural Risk Reduction sector?
France has had a unified natural disaster compensation scheme (the “CatNat scheme”) for more than forty years. As several stakeholders are involved in the various fields, it could also build a framework for a proper Natural Risk Reduction sector. This is supported by several developments in connection with the intensification of climate risks.
The CatNat regime protects citizens, businesses and local authorities against large-scale phenomena (abnormally intense events) by pooling risks at national level. The system is based on insurance companies and the French Caisse centrale de réassurance (CCR – Central Reinsurance Fund) which provides unlimited reinsurance coverage to companies that have the State guarantee. Each insured party contributes to this through an additional premium on their property damage insurance policy, the rate of which increased to 20% at the beginning of 2025 after remaining at 12% for a long time, and may change again.
A context marked by acceleration and intensification
Over the period 1982-2024, the CatNat scheme covered an average claims rate of 1.4 billion euros per year (i.e. €61.2 billion in total over the period, excluding cars). But this amount has reached 2.5 billion each year since 2016. Today, several studies estimate that it could rise to €4 billion per year by 2050, hence an increasing cost for insurers and insured parties. This means that changes are necessary, in particular to prevent insurers from selecting risks or even withdrawing coverage in areas subject to tension in terms of insurability (1).
Against this backdrop, the government asked the CCR to create a tool to monitor the insurance offer across the entire territory. The new Observatoire de l’assurabilité (Insurability Observatory) issued its first report on 15 June(2). From this it emerges that while insurance against damage to property in all French municipalities can now be found, particular vigilance is required in certain territories, particularly Overseas territories ("high risk areas").
The government took note of these conclusions and presented three areas of action to improve the insurability of French territories. It provides for increased attention to overseas territories, development of the CatNat scheme to ensure its long term sustainability (five-yearly review of the additional premium rate, reflection to ensure equitable distribution of the cost of the scheme among insurance policy holders) and reinforcing risk prevention focused on the individual reduction of vulnerability (working with insurers and local authorities to reinforce prevention and reduce residential property vulnerability).
A fund for prevention and reduction
It can be seen that the increase in disaster compensation costs is inevitable. Building a framework for a proper natural risk prevention and reduction sector would therefore not be excessive. Because while it is important to be able to manage a crisis once it has happened, it is also crucial to take steps to prevent it from happening. This is precisely the purpose of the CCR-F fund the CCR launched at the end of 2024 with the Starquest management structure specialising in private equity.
The Climate Change Resilience Fund (CCR-F) is an equity and quasi-equity investment fund in unlisted companies that contribute to developing solutions to prevent climate risks and adapt to climate change. The solutions targeted range from flood protection systems to AI-based risk prediction models and drought-resilient geotechnical solutions. As such, the first structure to have been supported by the CCR-F is the Hydroclimat start-up, which offers AI-based climate intelligence solutions (cf. €2 million with Région Sud Investissement mid-2025). More recently (March 2026), Uniject, a composite parts specialist for industrial bodywork, received 2 million euros to develop its new flood protection barrier manufacturing business.
Allocated €100 million, the fund is expected to make a total of fifteen innovative corporate capital investments at various maturity levels, with the objective of "responding to the assessment and prevention of natural disaster risks and to limiting their impact on populations and tangible assets."
All the elements for a structured industry
By definition, a sector covers both solution providers, engineering professionals, research and training stakeholders, institutional stakeholders, associations or federations and stakeholders in the banking and insurance sectors.
As seen previously, the solutions mainly include equipment and devices for protection and risk management as well as observation, monitoring, prediction and analysis tools – these increasingly rely on AI and/or space, such as CLS, a subsidiary of the CNES and the CNP.
In terms of engineering and design offices, there are many stakeholders, whether non-specialists or specialists (e.g.: Artelia, Egis, Elvia, Géolithe, Ginger-Burgeap, Géotec, Ingsols, Sage, Sketch…). Institutionally, several bodies are working on these topics, such as Cerema, providing expertise for planning, Ineris, a risk specialist, and BRGM, which, among others, oversees the Georisques site (https://www.georisques.gouv.fr/) with the Ministry or Météo France and the Office français de la biodiversité (OFB – French Office for Biodiversity).
Finally, as we have seen, general insurance companies and the Caisse Centrale de Réassurance (CCR) are key stakeholders in the Natural Risk Reduction sector. But the Insurance category also includes more specialised stakeholders such as the young company Descartes Underwriting which handles corporate insurance, and which was recently selected for the French Tech 120 (Fintech-AssurTech category). This "insurtech" offers a new generation of parametric insurance that helps strengthen its clients’ resilience against several existing and emerging climate risks. Its machine learning and real-time monitoring of satellite images & IoT climate technology enables it to offer coverage for customers operating in many sectors and geographic areas(3).
In parallel to this, it should also be noted that there are already Assises nationales (National Conferences) for natural risks intended for local authorities. These conferences are held every three years, the latest (6th edition) having taken place in Toulouse in October 2025 with the slogan: "Let's move beyond awareness and take action together!”. There is no doubt that provision of a framework for a proper Natural Risk Reduction sector will be beneficial for all the local authorities concerned.
1) The subject of compensation for natural disasters is of interest to other stakeholders such as the French Cour des Comptes (Court of Auditors) and the Haut Commissariat à la Stratégie et au Plan (High Commission for Strategy and Planning). It was also the subject of a report by a group of experts (Langreney report) and law proposals (in 2024, by a senator wishing to ensure the balance of the scheme and in 2025, by Fabrice Barusseau in his project on adaptation to climate change).
2) This first report covered detached homes in metropolitan France and in five overseas departments and regions (Guadeloupe, Martinique, Réunion, Saint-Martin, Saint-Barthélemy) and three natural risks: flooding (overflows of rivers, runoff), drought (CSS: clay shrink-swell), cyclones (overseas). Others are expected to follow.
3) Cf. protection against direct and indirect financial losses resulting from natural disasters and extreme weather events, including losses suffered by third parties related to investments and operating losses not related to property damage.