Heatwaves and drought: adapting campsite insurance to new climate risks

A thermometer reading over forty degrees for several consecutive days is no longer just the sign of a successful summer season. For a campsite operator, this figure has become an operational red flag that triggers a chain of consequences, from fire hazards to water usage restrictions. The traditional insurance model, which often relies on the observation of physical damage to intervene, is reaching its limits against these climate phenomena that paralyze business activity without necessarily destroying infrastructure.

The shift in climate risk: from weather hazards to operational paralysis

For decades, campsite insurance was designed to respond to sudden and visible events, such as a storm tearing off roofs or a flash flood. Heatwaves and droughts operate on a different timeline because they settle in gradually and create operational risks that are invisible at first glance. The danger lies not only in the heat itself, but in the administrative decisions it provokes.

When a region is placed under a red fire alert, authorities may decide to prohibit access to forested areas or, in extreme cases, order the preventive evacuation of establishments. In this situation, the campsite suffers no material damage, as the infrastructure remains intact, but its activity is completely interrupted. Most standard outdoor hospitality contracts only trigger business interruption coverage (the reimbursement of lost earnings following a shutdown) if there is prior physical damage.

This disconnect between administrative reality and contractual clauses represents a major risk for the financial health of the company. It is now necessary to seek extensions of coverage that include access impossibility or administrative closure ordered by local authorities, even if no fire has broken out on the site. This approach requires reasoning in reverse compared to the rest of the market: we do not look at what the insurer offers by default, we start from the crisis scenario where guests must leave, and we build the financial protection around that eventuality.

Drought and water management: a threat to the customer promise

Prolonged drought leads to water restrictions that directly hit the core of a campsite’s service. Prohibitions on filling swimming pools, topping them up, or even maintaining green spaces radically change the experience offered to vacationers. Beyond the aesthetic aspect, the operator's professional liability (the insurance that covers your responsibility if a client blames you for an error in your service) can be called into question.

If a guest has booked a stay in an establishment highlighting its water park and it is closed by administrative order, the grievance for non-conformity of the service is real. Although force majeure may be invoked by the operator, the multiplication of these events makes this defense more fragile. Customers, who are increasingly informed, expect financial compensation.

A tailored coverage must therefore integrate these intangible risks. It involves planning how the insurer can support the establishment in managing these serial claims. Furthermore, drought impacts the very structure of the soil. The phenomenon of clay shrinkage and swelling can cause cracks in permanent buildings, sanitary blocks, or terraces. These slow-moving damages require special attention during underwriting, as they are often excluded or subject to very high deductibles (the portion of the loss you pay out of pocket) in standard contracts.

"Climate risk is no longer an exceptional event that we endure; it is a component of daily management that must be budgeted for and intelligently transferred to the insurer."

Protecting the director against increasingly complex safety protocols

The increase in heatwave and fire risks places growing legal pressure on the shoulders of campsite managers. In the event of an emergency evacuation or a heat-related accident, the personal liability of the manager can be challenged by customers, employees, or authorities. The director is expected to have anticipated every scenario, updated their risk assessment documents, and trained their staff in increasingly technical crisis procedures.

This is where D&O insurance (the insurance that protects your personal assets if a shareholder or a third party holds you personally liable) comes into play. In the campsite sector, this protection is often neglected in favor of only insuring the buildings and the company’s general liabilities. However, an error in judgment during a heatwave alert or a delay in applying a local decree can lead to a direct claim against the manager.

Legal protection and directors' liability coverage become essential ramparts. They provide the funds for the manager’s defense and protect their personal property if their management is criticized following a covered incident. At Lesto, we believe that protecting the business tool is inseparable from protecting the one who drives it, especially when the regulatory environment becomes as volatile as the climate.

Toward a global vision of campsite resilience

To adapt sustainably, campsites must move from a logic of insurance consumption to a logic of strategic risk transfer. This begins with a precise audit of the site’s geographical exposure. An establishment located in a dense forest area will not have the same priorities as a seaside campsite, even if both experience the heatwave.

The analysis must include dependence on third-party infrastructure. What happens if the local power grid fails due to overconsumption linked to air conditioning? What happens if the main water supplier cuts off the supply? These supplier failure scenarios must be integrated into contracts to ensure that lost earnings are compensated.

It is also necessary to review the coverage limits (the maximum amount the insurer will reimburse). With the inflation of reconstruction costs and the complexity of new environmental standards, amounts set five years ago are often obsolete. In the event of a major loss, under-insurance can mean the end of operations because the compensation will not be enough to rebuild according to the current standards required by the authorities.

As a broker that reasons in reverse compared to the market, we start by mapping these specific vulnerability zones for each site before seeking or building adapted coverage. A campsite’s resilience to climate change does not just depend on installing new equipment, but on a financial protection architecture capable of absorbing shocks, whether they are material, administrative, or legal.

The climate is changing the very nature of outdoor hospitality, transforming once-rare hazards into operational certainties. Anticipating these transformations allows you not only to secure your balance sheet, but also to reassure financial partners and customers about the long-term viability of the establishment. Discussing your climate risks is the starting point for transforming a vulnerability into a mastered competitive advantage.

If you would like to evaluate how well your current guarantees match the evolving climate risks on your site, we can analyze your specific needs together to build a tailor-made protection.