Findings of the current research are summarized in the Mater Research Report, which consists of eight sections. The Introduction (Chapter 1) summarizes background and rational for the research. Chapter 2 discusses environmental safety from the public policy perspective as an issue of national security. Chapter 3 refers to analyzes the current role of insurance for ensuring environmental safety. Chapter 4 provides the analytical framework for 'national' research outlining policy process and defining criteria for further studies. Chapter 5 presents findings of current situation with EI implementation in the Russian Federation. Section 5.1 sets the scene for the discussion of the current and perspective role of insurance in managing environmental risks in Russia. After review of research methodology (Section 5.2) and a brief overview of key steps of EI promotion at the national level (Section 5.3) Section 5.4 particularly deals with analysis of the EI system determinants. The findings of this analysis are summarized in Section 5.5. Chapter 6 is devoted to case studies of EI promotion at the regional level in Russia with concluding Section 6.5 presenting key factors of success for EI implementation at the regional level in Russia. Key research findings as well as possible approaches to EI promotion it at the regional level in Russia (policy options) based on these findings are presented in Chapter 7.

Master Research Report Outline

Abstract

Environmental insurance (EI) has been considered as an effective tool to strengthen environmental safety worldwide. It allows for pooling resources for pro-active risk reduction measures and paying compensations for affected parties in case of damage occurred. Moreover, it provides incentives for cleaner and safer production.

Environmental insurance was introduced into Russian environmental policy agenda as early as in 1991. The study of the current national EI system proved the system under development. There are factors associated with the EI socio-economic, political, and institutional context both encouraging EI development (e.g. aggravation of environmental problems and steady upturn of the national insurance market) and those acting as obstacles, including the low level of environmental consciousness of the society and weak capacity of the national environmental management system. A number of deficiencies in the EI legislation were identified. There is a need for strengthening EI formal guidance in terms of approval the relevant guidelines and procedures. Institutional capacity of many EI stakeholders, including local authorities, judicial bodies, and the general public, is not sufficient for adequate performing their functions. As a result, the actual practice of applying insurance for protecting against technology-related environmental risks has been limited so far.

Despite these limitations there have been attempts to implement insurance into regional environmental policies in several Russian regions, including the Moscow Region, the Leningrad Region, the Nizhniy Novgorod Region, and the Bashkortostan Republic. Factors of success for EI promotion include, among others, i) the support from top regional officials, ii) integration of EI promotion into regional strategic initiatives, iii) developed insurance community, iv) influential environmental authorities, and v) collaboration with counterparts form other regions.

Based on the review of EI from international, national, and regional perspective, possible approaches to introducing insurance into environmental security policies at the regional level in Russia are developed. They differ in the direct regulatory input to EI promotion. Relevance of these alternative to current context dependent on the state of national EI system determinants were discussed the most appropriate was singled out.

The current research contributes to knowledge on the current place of EI in the Russian public policies for environmental insurance and provides background for devising recommendations on fostering EI development in the pilot region (the Vologda Region) (see Policy Paper).

Keywords: environmental risk management, environmental policy, environmental safety, environmental insurance