Since the emergence of modern insurance for trade ships in the late 1600s, the insurance sector has been designed primarily to protect against risk and absorb financial losses. However, as compounding pressures reshape the insurance system, there is a growing focus on the role of insurers in supporting investment in and adoption of resilience solutions not only to manage risk but also to actively reduce it.

As narratives about insurers’ role regarding resilience gain momentum, this report explores the underlying assumptions and identifies areas for further nuance and shared responsibility.

While these assumptions often contain elements of truth, they can overlook important market realities, operational constraints, and tradeoffs. To help add nuance to these assumptions, and identify barriers to further influence resilience outcomes by the insurance system, the report goes into more detail on some of the underlying challenges:

The goal of this report is not to downplay ambition. Insurers do have a role in supporting resilience, and many are already taking steps to do so. However, this report argues that civil society expectations for insurers to drive climate resilience are outpacing the realities of how insurance markets function. We outline three essential shifts we think are needed to unlock a more constructive path forward that can help focus our collective efforts on practical solutions and add nuance to key narratives.

These are not new recommendations. Other organizations have made similar calls to action in various configurations in recent years, and in some cases are already actively working to implement them. Yet, we include them here to acknowledge that they are not yet common practice, to demonstrate their importance in unlocking our vision for a recalibration of the role of insurance in resilience, and to affirm our willingness to roll up our sleeves and support these efforts going forward.