Assessing drought induced subsidence risk in France under current and future climate

Subsidence risk induced by drought produced widespread damages to low- rise buildings in France in 2022, and has become of increasing concern for insurers. Companies expect greater average annual costs in the near future, and modeling solutions are scare to model the impacts by extreme events. In this poster, we present a stochastic model designed to calculate the full distribution of annual losses over an home insurance portfolio. It generates a stochastic set of SSWI footprints based on ERA Land data and at each location, evaluates both the claim propensity and the insured damage. Results will show (i) how damage rates for drought induced subsidence risk compare to other perils in France and (ii) how the risk changes between current and future climate.