From Climate Change to Conflict: Mitigation through Insurance?

An increasing number of studies suggest that climate change aggravates conflict, especially in the Sahel and Horn of Africa in Sub-Saharan Africa. The evidence, however, is contested: non-random sample selection and uncertainty about mechanisms lead to an inability to make causal statements about this relationship. One often suggested hypothesis is that households affected by weather shocks – such as droughts or floods – lack buffers to cope, and resort to strategies such as migration, theft, and resource claims. This, in turn, could lead to social unrest and conflict.

To combat this, policymakers increasingly promote insurance against weather shocks. While evidence shows that it may provide relief against direct consequences of shocks, the indirect relationship to conflict is still unknown. Alternative hypotheses suggest that insurance, for example by crowding out pre-existing informal risk management arrangements, or by increasing productivity and subsequent pressure on natural resources, may increase conflict.

In this study, we ask how and to what extent climate-induced weather shocks and insurance impact conflict? Can we design and test interventions that can be jointly implemented with insurance to strengthen any conflict-reducing effects or mitigate any conflict-aggravating effects of insurance?

Based on a mixed-methods research design we study a well-established drought insurance product for pastoralists in Ethiopia and Kenya which is being considered for scale-up across the Sahel and Horn. The scientific breakthroughs will be an understanding of the complex relationships between climate-induced weather shocks, insurance, and conflict and cooperation, as well as the design of an insurance-based intervention that reduces conflict. The envisaged societal breakthroughs will be a reduced impact of climate-induced weather shocks (SDG13) on conflict (SDG16), increased adaptation to climate change (SDG 13), financial inclusion (SDG9), increased productivity (SDG8), and a reduction in inequality (SDG 5, 10) for those insured, as well as their communities and societies.