Developing a risk assessment tool for vulnerable coastal ecosystems and communities – the Coastal Risk Index

Coastal communities around the world are on the front line of climate change and a warming ocean. The resulting sea level rise, more intense storms, and extreme storm surges, as well as unsustainable land development, all contribute to the degradation of natural capital and increase the exposure of millions of people to ocean risk. Coral reefs, mangroves and other coastal ecosystems are a critical first line of defence against this risk. But, despite their role in protecting lives and property, their value is largely disregarded, with the multiple benefits of coral reefs and mangroves rarely accounted for in risk industry models, disaster risk reduction strategies, or development priorities.

AXA XL is working with IHE Delft and the University of California, Santa Cruz to develop a ground-breaking Coastal Risk Index (CRI) that integrates the protective benefits of coastal ecosystems into insurance risk models for the first time. The Index provides a new, more detailed way to assess coastal flooding in the context of climate change, modelling flood hazard and storm surge in current conditions and in possible future climate scenarios up to 2050. Through global flood maps showing flooding with and without coastal ecosystems present, the CRI demonstrates the importance of mangroves and coral reefs in reducing risks to vulnerable communities – and the increased exposure to flood hazard for investors who fail to take into account the resilience benefits of natural coastal ecosystems in the face of climate change.

The Index will enable insurers to price and transfer risk more accurately as well as support investors and the development sector in mapping both future liabilities and investment opportunities where nature-based solutions provide resilience benefits.  The CRI can also support policymakers in understanding the exposure of their communities to coastal hazards while demonstrating the importance of proactive coastal ecosystem management in building resilience.

The CRI aims to drive a systemic shift in how to measure coastal risk and strengthen the case for using nature-based solutions to increase resilience and sustainably manage biodiversity.

Explore the Coastal Risk Index here.