INTEREST: Insurance, technological risk and emerging science and technology policies

• Forschungsstelle: EU FRP
• Projektnummer: 01.0346
• Projekttitel Englisch: INTEREST: Insurance, technological risk and emerging science and technology policies

Schlüsselwörter (Englisch)

Insurability; technological risks; S&T policies

Alternative Projektnummern (Englisch)

EU project number: HPV1-CT-2001-60024

Forschungsprogramme (Englisch)

EU-programme: 5. Frame Research Programme - 4.5 Support for the development of scientific and technological policies

Kurzbeschreibung (Englisch)

See abstract

Weitere Hinweise und Angaben (Englisch)

Full name of research-institution/enterprise:
Association Internationale pour l'Etude
de l'Economie de l'Assurance

Partner und Internationale Organisationen (Englisch)

Coordinator: Policy Studies Institute, London (UK)

Abstract (Englisch)

Objectives agreed in the contract:
· to identify the past and present role of 'insurance' in relation to innovation which promotes, or challenges, sustainable development.
· to identify opportunities for promoting sustainable development through innovation by adjusting or sharing the responsibilities of private sector actors, regulators and policymakers.
· to establish how sustainable development innovation can be promoted using risk management mechanisms from insurance, such as risk assessment, loss prevention etc., in other domains.
· to establish how and to what extent sustainable development innovation can be promoted by the insurance sector using a wider set of tools, such as technology assessment, to improve its capacity to manage novel risks.
· to explore policy options for the complementary use of insurance-related and other risk management mechanisms.

Existing and expected results (scientific and policy):
There are three main roles for insurance in linking innovation and sustainability:
· underpinning the development and deployment of technologies which promote sustainability by helping to manage technological risks and to provide a more secure financial framework for innovation;
· regulating the rate and direction of innovation associated with radical technologies which have potential impacts on the environment or third parties and whose sustainability is contested; and
· promoting innovative solutions for managing the risks associated with natural hazards.

The State has a key role to play in defining the role which insurance plays in managing risk. In setting the framework for insurance, policymakers can
· encourage insurance companies into the 'risk market' so that the State, organisations and individuals do not bear all the risks of the innovative activity;
· reduce barriers to innovation by transferring risks, without compensation, to third parties;
· encourage responsible behaviour on the part of technology developers;
· encourage precautionary patterns of behaviour by assigning all risk to technology developers;
· encourage loss prevention activities; and/or
· promote equity between different types of organisation or groups of citizens.

Further scientfic activity in this field, which must link technical expertise with social science, could address: risk assessment and uncertainty assessment; the insurability of innovation;
foresight/horizon scanning; human factors in insurance/innovation; steering the direction of innovation.

Lessons learnt so far
The application of the precautionary principle, as set out by the European Commission, appears to be relevent only in circumstances where the risks would not meet insurability criteria in any event.

There are opportunities to exploit synergies between insurance and policymaking by:
· mobilising existing actuarial data;
· earlier engagemnt in the the innovation process on the part of insurers;
· greater insurance sector participation in stakeholder activities.

Synergies with other STRATA/TSER/Key action projects:
The project tested the hypothesis that the greater use of insurance-based mechanisms could encourage the application of the precautionary approach in policy-making. There were therefore synergies with the PRECAUPRI project (Regulatory strategies and research needs to compose and specify a European policy on the application of the precautionary principle)

Policy exploitation strategy (followed already or foreseen):
The final project report was submitted to the European Commission in January 2003.

Workshop papers have been published in the Geneva Association series 'Etudes et Dossiers' No 252 in February 2002. This is read by economists in the insurance sector. Further workshop papers will appear in 'Etudes et Dossiers' in early 2003.

A special edition of the 'Geneva Papers on Risk and Insurance: Issues and Practice' in July 2003 will be devoted to the INTEREST. Papers will be submitted in March 2003. Again, this is targeted at insurance sector economists. Further publications targeted at the risk community are planned.

Project documentation is being disseminated via the Policy Studies Institute Website.

Workshops have been attended by a number of policymakers holding environment and industry briefs who have begun to apply the findings in their work. Partners in the INTEREST project will follow up these links with policymakers.

The partners are considering a bid for a follow-up project under priority seven of the Sixth Franework Programme (Citizens and Governance in a knowledge based society).

Datenbankreferenzen (Englisch)

Swiss Database: Euro-DB of the
State Secretariat for Education and Research
Hallwylstrasse 4
CH-3003 Berne, Switzerland
Tel. [phone]
Swiss Project-Number: 01.0346