PhD Studentship - Parametric protection from drought risk and water scarcity in the 21st century

About the Project

Summary of Award
100% fees covered, and a minimum tax-free annual living allowance of £20,780 (2025/26 UKRI rate).

Overview of Project
Insurance is a risk-sharing strategy through which the insured party transfers the risk it bears from a hazard to the insurer in exchange of a payment. Parametric risk solutions provide protection for at risk individuals and organisations by guaranteeing financial recovery if a hazard, such as drought, occurs.

Globally, drought and water scarce events have catastrophic economic impacts to sectors which rely on reliable, plentiful and safe access to water supplies. Ensuring economic protection for key sectors such as energy, agriculture and the manufacturing industry will be paramount over the coming decades as the climate changes, the frequency, intensity and impact of droughts worsen, and multi-sectoral demands for water grow at an unsustainable rate.

Parametric drought insurance policies typically offer protection to parties who are exposed and vulnerable to drought, with insurance products hinging largely on their trigger mechanisms – i.e. the specific hydrological conditions that must be met to initiate an insurance payout. Typically, the policies are based on the probability of when and to what extent a drought will occur, and the potential impacts the drought will have on the insured party. Types of triggers for drought insurance payouts can range from simple precipitation measurements to sophisticated integrated indices and remote sensing approaches.

The selection of appropriate hydrological triggers for drought insurance requires careful consideration of local conditions, available data infrastructure, and stakeholder needs. Quantifying drought risk to specific sectors is difficult without complex multi-index and multi-model frameworks that capture the cascading and dynamic impacts of drought on specific sectors with heterogeneous water needs. Furthermore, to ensure policies are ’future-proof’, insurers must also consider how the climate, hydrological and water system may change over the 21st century and account for this through adjustable policy design. For example, drought characteristics such as spatial extent, duration and severity may diverge from those observed historically under a warming climate with more intense El Niño events. Likewise, investment in new water infrastructure, or decommissions of old water infrastructure, have significant potential to improve (or worsen) water supply resilience to key sectors during drought events. These dynamic system feedbacks should be considered when designing insurance policies as not doing so may lead to severe under- or over-insurance.

Research Questions

1. How do the evolving water demand profiles of non-residential sectors (e.g. energy, manufacturing, agriculture) influence the spatio-temporal characteristics of drought risk at regional and national scales under climate change projections?
2. Which combinations of climate, hydrological, and water-resource variables provide the most reliable trigger mechanisms for parametric insurance to minimise basis risk (the gap between insurance payout and actual loss) for specific industrial water users?
3. To what extent do future climate non-stationarity and dynamic system feedbacks, such as infrastructure changes, impact the long-term solvency and efficacy of fixed vs. adjustable parametric insurance indices?
4. How does the cost-effectiveness of parametric drought insurance compare to physical adaptation measures (e.g. storage infrastructure or demand-side efficiency) as a strategy for enhancing multi-sectoral water resilience?

Methodology

This project will use a multi-modelling framework to quantify drought risks to, and the potential of parametric drought insurance for non-residential (non-public) water users in different sectors. The study will combine outputs from climate, hydrological and water simulation models to investigate the costs and benefits of the parametric insurance indices.

The project will be applied to a UK case study and use UK specific datasets and models e.g. UKCP18 (Met Office Hadley Center, 2018), Shetran hydrological model (Lewis et al. 2018), the Water Resources Model for England and Wales (Murgatroyd et al. 2022). However, the analytical framework and methodological design will ensure that the approach can be applied in other global contexts.

Objectives:
1. To quantify how different sectors’ water use might evolve in the future and explore what that means for sector-specific drought risks at a regional and national scale.
2. Consolidate recent advances in monitoring technology and data analysis techniques to inform development of appropriate index-based parameters for sector-specific drought insurance based on features of climate, hydrological and water resource systems.
3. To test the performance of parametric insurance indices against future scenarios of change, including projections of climate change and changing sector-specific water demands.
4. To compare the cost-effectiveness of index-based insurance measures with other pathways for drought risk adaptation, such as water resources infrastructure

Start Date
21st September 2026

Duration of Award
3.5 years

Sponsor
NERC

Eligibility Criteria
A 2:1 Honours degree, or international equivalent, in a subject relevant to the proposed PhD project (inc. geography, earth sciences, engineering, computing and mathematics).
·        Programming (essential)
·        Statistics (essential)
·        Data processing and analysis (essential)
·        Water systems and hydrological modelling (preferable)

Home and international applicants (inc. EU) are welcome to apply and if successful will receive a full studentship. Applicants whose first language is not English require an IELTS score of 6.5 overall with a minimum of 5.5 in all sub-skills.

International applicants may require an ATAS (Academic Technology Approval Scheme) clearance certificate prior to obtaining their visa and to study on this programme.

How to Apply (Web Text)
You must apply through the University’s Apply to Newcastle Portal.

Once registered select ‘Create a Postgraduate Application’.

Use ‘Course Search’ to identify your programme of study:
* search for the ‘Course Title’ using the programme code: 8040F
* select *‘*PhD Civil Engineering – Civil Engineering (Water Resources) (full time)' as the programme of study

You will then need to provide the following information in the ‘Further Details’ section:
* a ‘Personal Statement’ (this is a mandatory field) - upload a document or write a statement directly into the application form
* the studentship code **IRISK04** in the ‘Studentship/Partnership Reference’ field

when prompted for how you are providing your research proposal - select ‘Write Proposal’. You should then type in the title of the research project from this advert. You do not need to upload a research proposal.