Shifting Insurance Models

Insurers and re-insurers work in a collaborative way with governments and public FIs to manage coverage in a way that can close critical coverage gaps, price climate risk accurately, and simultaneously manage premium prices.

• The insurance industry holds a pivotal role in the adaptation finance ecosystem.
• Climate change is partly responsible for a recent surge in insurance premiums and costs are mounting at the same time that regulatory conditions are making it challenging for insurers to make efficient decision about coverage (e.g., CA).
• Low levels of insurance penetration in emerging economies (especially Africa) mean that economic losses from weather-related disasters are not yet reflected in credit and insurance portfolios.