The report the insurance industry was expecting — and dreading
On April 24, 2026, the Court of Audit published a report on the financial sustainability of the natural disaster compensation scheme. The conclusions are unambiguous: the Cat-Nat scheme, created in 1982 and long considered an unshakeable pillar of national solidarity, is structurally weakening.
The figures speak for themselves. Since 1982, 3.6 million claims have been compensated for over €50 billion. In 2024, the scheme collected €2.2 billion in premiums and paid out €2.1 billion in damages — a precarious balance, with no safety margin at all. And the CCR (Caisse Centrale de Réassurance, the public reinsurer) forecasts a rise in claim costs of +47% to +85% by 2050, depending on climate scenarios.
In figures: €50bn paid out since 1982, +85% projected increase by 2050, €3.5bn cost of RGA in 2022 alone.
The Court does not say the scheme will collapse tomorrow. It says that in the worst-case scenarios — several consecutive years of high claims, repeated intense droughts — the State guarantee would be activated, creating a direct budgetary risk for public finances. This is the first time such a serious institution has voiced this warning so clearly.
The fundamental principle of insurance is being violated
There is a tension that the Court of Audit's report points to without naming explicitly, but that every industry player understands: you cannot insure a certain risk.
Insurance is built on chance — a possible but uncertain event, whose probability of occurring can be modeled and pooled among a large number of policyholders. This is the basis on which the Cat-Nat scheme was built in 1982: a modest surcharge on all home insurance policies, to cover rare and unpredictable events.
But in 2026, clay shrink-swell subsidence is no longer an uncertain risk for millions of homeowners. It is a certainty with an approximate date.
The droughts of 2003, 2018, 2019, 2022, 2025 have followed one another at a pace that defies the definition of exceptional. In the clay zones of the South, the Centre and the Paris basin, the question is no longer 'will it happen?' but 'how often?'. Yet under insurance law, a risk that is known and predictable at the time of underwriting can legitimately be excluded or priced at its real cost.
Recommendation No. 5 of the report is particularly significant in this respect: the Court calls for forward-looking RGA risk maps to be integrated into real estate transactions by 2027. This is an official acknowledgment that RGA is a localizable and predictable risk — the exact opposite of the chance element that justifies national solidarity.
The 8 recommendations: reading between the lines
The Court of Audit sets out 8 recommendations. Read at face value, they seem technical and reasonable. Read through the lens of long-term sustainability, they trace a very clear trajectory: the scheme will tighten, prevention will become mandatory, and homeowners who have not taken action will be gradually less well covered.
1. Improve risk information. Translation: homeowners will no longer be able to say they didn't know. 2. Secure the annual publication of CCR data. Translation: make the risk unavoidable in every real estate transaction. 3. Strengthen financial stress tests starting in 2026. Translation: prepare public opinion for further surcharge adjustments. 4. Regularly review the surcharge rate. Translation: the surcharge will keep rising — the 2025 increase is not the last. 5. Forward-looking maps in real estate transactions by 2027. Translation: RGA risk will officially be built into property values. 6. Roll out Risk Prevention Plans more broadly. Translation: municipalities without an up-to-date plan could see their access to the scheme restricted. 7. Develop 'building back better after a claim'. Translation: compensation is starting to be conditioned on preventive behavior. 8. Strengthen the independence of the Cat-Nat commission. Translation: an end to recognitions granted under political pressure — the criteria will tighten.
Recommendation No. 7 deserves the most attention. Conditioning reconstruction on preventive standards establishes the principle that compensation will not remain unconditional indefinitely. It's the first step toward a scheme where homeowners who have taken preventive measures are treated better than those who haven't.
Why an abrupt exclusion of RGA is unlikely — but a transformation is certain
Purely and simply excluding RGA from the Cat-Nat scheme would be politically impossible in the short term. Over 10 million homes in France are built on at-risk clay soil. Telling affected homeowners that their property is no longer covered would amount to publicly acknowledging that the State allowed massive construction in risk zones without informing them. The immediate impact on real estate would be brutal.
But that's not the only possible path. What's being prepared is a gradual transformation. Today, compensation comes after a claim, unconditionally; in 5 to 10 years, it will be conditioned on preventive measures taken. Today, it's blind national solidarity; tomorrow, modulation based on exposure and homeowner behavior. Today, a single surcharge for everyone; tomorrow, differentiated pricing based on actual risk level. Today, the risk is invisible in transactions; tomorrow, it will be built into real estate prices (2027 mapping). Today, Cat-Nat covers everything; tomorrow, higher deductibles or exclusions for those who haven't taken preventive action.
The precedent of flood zones is telling: in certain highly exposed areas, insurers are already starting to refuse coverage or price it prohibitively. RGA could follow exactly the same path — not through an abrupt political decision, but through the gradual erosion of coverage.
What this concretely means for your home
The Court of Audit is France's highest financial court. Its reports don't stay in drawers — they feed into legislative reforms, budgetary decisions, and insurers' choices. This report will be read, cited, and translated into action in the coming months.
For a homeowner in a clay area, three effects are foreseeable in the short term:
1. The surcharge will keep rising. The 2025 increase (from €25 to ~€40 per year) is only one step. The Court recommends regular reviews with the possibility of exceptional adjustments.
2. RGA risk will be built into your property's value. With mandatory forward-looking maps in transactions by 2027, a home in a clay zone with no claims history or active protection will mechanically be worth less.
3. Cat-Nat recognition criteria will tighten. Recommendation No. 8 is explicit: an end to political pressure on recognition decisions. Denial rates — already at 84% for some orders — will likely rise further.
The question is therefore not 'will the scheme disappear?'. It's: how much time do homeowners have before coverage shrinks and prevention becomes the only real protection?
Prevention: from option to obligation
There is something historic about this report. For the first time, the Court of Audit — not an industry lobby, not a private insurer — officially states that prevention is the only viable long-term lever for keeping the scheme balanced.
This is exactly what the auto insurance industry has understood for decades: drivers who install active safety systems cost less and get better terms. The same reasoning will apply to soil risk.
In a few years, the question your insurer asks will no longer just be 'were you flooded?' — it will also be: 'did you protect your foundations?'. Homeowners who anticipated this shift will be in a radically different position from others: a stable home, preserved value, full coverage — and documented proof that they took action.
The window to act preventively — that is, before the first damage appears, at an affordable cost (several times less than underpinning) — is open today. The Court of Audit's report indicates it will not stay open indefinitely.
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