EUSPA-EIOPA White Paper: Earth Observation and Copernicus applications in insurance

Satellite technology, in particular, advanced applications developed through the EU’s Copernicus programme, offers a transformational approach to managing environmental risks. By leveraging Earth Observation (EO) data – a field in which Europe is a global leader – insurance companies and supervisory authorities can strengthen their risk management efforts and improve overall disaster preparedness.

A joint pilot undertaken by the EU Agency for the Space Programme (EUSPA) and the European Insurance and Occupational Pensions Authority (EIOPA), has demonstrated that open-access spatial data provided through Copernicus services can significantly improve flood assessment capabilities. EO data from Copernicus allows for the near-real-time mapping of flood extents, which can be matched to regulatory reporting by insurers to estimate loss magnitudes and the potential impact on individual insurers.

The benefits extend beyond flood monitoring: Copernicus capabilities can track the expanse of wildfires, earthquakes, landslides and windstorms, while also facilitating drought assessment through vegetation indices as well as ecosystem service monitoring for nature-related risks. Such wide-ranging applications can contribute to addressing well-known challenges with data collection on multi-dimensional risks and support open access to actionable data.

This white paper makes a compelling case for the integration of Earth Observation data in insurers’ risk assessment practices and supervisory processes. The insights presented in this report complement EIOPA’s previous studies, tools and data, which it provides in its capacity as a centre of excellence for catastrophe modelling to enable European supervisors and insurers to effectively assess, monitor and supervise these catastrophe risks.