Prevention in Environmental Insurance

The goal of the chapter is to analyse the preventive aspect of insurance covering environmental risks. This seems important for a few reasons. Firstly, the general goal of environmental liability insurance is to follow the liability legal regime, which has started including prevention as an inherent part of the environmental liability regime. Secondly, it coincides with the visibly changing paradigm of the role of insurance, i.e., from risk transfer to risk prevention, which can be observed in many new innovative insurance products, which are slowly infiltrating the general function of insurance. Environmental risks seem to be a very relevant field for enhancing new forms of insurance prevention, in both the macro- and micro-scales. What is more, it is interesting to consider prevention as a field for cooperation between the insurance industry and governments (for example in the form of prevention funds). Thus, a thesis can be made about the synergistic effect of environmental liability legislation and the preventive function performed by insurance. Also, another issue appears, i.e. whether prevention as an express part of the insurance contract needs to be regulated in private law as an emanation of the principle of good faith or the principle of indemnity or could eventually be taken into account as part of insurance market regulation as a reflection of sustainable development. Thus, it will be discussed the issue of whether prevention can be directly linked to sustainable development on both the level of the insured organisations (or individuals) and the level of societies.