Market Overview: Climate Risk Solutions For The Insurance Industry
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Executive Summary
The insurance industry is at the forefront of climate risk management; insurers offer risk transfer solutions that support climate risk management in other industries and are exposed to climate change-related risks in their own assets and liabilities. As climate change progresses, and insurers work to manage these risks, they rely on a variety of digital solutions. Catastrophe (CAT) models predict damage from low frequency, high impact events and inform underwriting decisions. Climate projection models take a longer-term view and feed into business strategy, investment decisions and risk disclosures. Thirdly, real-time hazard monitoring provides critical information immediately before, during and after extreme events. This report provides an overview of these technologies and recent developments in the market for climate risk solutions for the insurance industry.
Table of contents
Insurers face unique climate risks and opportunities across business functionsSocial, economic and political factors exacerbate insurers’ climate risk
Traditional and alternative risk transfer products insure climate risk
Insurtech firms emerge to increase availability of climate risk coverage
Developments in climate risk digital solutions support the insurance industry
CAT models inform ratemaking, underwriting and reinsurance purchasing decisions
Forward-looking climate projection models contribute to longer-term risk management
Real-time hazard monitoring improves responses before, during and after extreme events
Table of figures
Figure 1. Segmentation of climate risk solutions for the insurance industryFigure 2. Vendors offering future-looking climate projection models for the insurance industry
Organisations mentioned
Allianz Global Investors, AON, Arbol, Artemis, Baron Weather, Chicago Mercantile Exchange, CLIMADA Technologies, CLIMsystems, Conning, CoreLogic, EigenRisk, Fathom, Futureproof, HDI Global, Howden, ICEYE, Insurance Development Forum, JBA Risk Management, KatRisk, Kettle, Liberty Mutual Insurance, Marsh, Mitiga Solutions, Moody's, Munich Re, NASDAQ, National Association of Insurance Commissioners, Nature Communications, OnSolve, Risk Frontiers, riskthinking.AI, Springer Nature, Swiss Re, The Nature Conservancy, Travelers, United States Census Bureau, University of California, Berkeley, Verisk Analytics, WTW, ZurichAbout the authors
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