“Basically, if there is more damage, someone has to pay for it,” said Ernst Rauch, a climate expert with Munich Re, a major reinsurance company in Germany . Either insurance companies, the state, or the person who suffered the damage must foot the bill.

The logic behind insurance is that many people sign up, but only a few suffer losses and receive compensation. If a growing number of people are hit by losses, however, insurance companies will pass on the risk and increase premiums for insurance holders. 

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