Climate change is increasing the risk of damage from unexpected events such as extreme weather and natural disasters. While steps can be taken to reduce the risk, they can’t eliminate it entirely – that’s where insurance comes in. It allows people to transfer financial risk and protect themselves from financial losses. 

In this episode, James and Daisy discuss insurance. How is insurance changing with our changing climate? Will certain areas become uninsurable? Can the insurance industry help build a more resilient future?  

SOME RECOMMENDATIONS: 

• Allianz SE (2025) – Allianz board member, Günther Thallinger, warns that the global financial system is at risk and that escalating extreme weather events could soon make some risks uninsurable. 
• Howden & BCG (2024) – This report highlights insurance as critical to mobilising $10 trillion of committed climate transition investment.
• David Howden is CEO of Howden and has written extensively about the problem of the insurance protection gap. 

OTHER ADVOCATES, FACTS, AND RESOURCES:

• AXA (2024) – In the 2024 AXA Future Risks Report, climate change is identified as the top risk for both experts and the general public in all international regions surveyed. This marks the third consecutive year that climate change has been ranked as the top global risk by AXA.

• World Economic Forum (2024) – “Unlike traditional insurance, parametric policies focus on the magnitude of a specific type of an event, with a simple, straightforward payout process.”
• Environmental Finance (2025) – An innovative wildfire insurance product offers lower premiums and deductibles as incentives for sustainable forest management. 

• AccuWeather (2025) – Estimates total damage and economic loss from LA wildfires of between $250 billion and $275 billion. 
• News Statesman (2025) – “California created an insurer of last resort in 1968, the California Fair Access to Insurance Requirements (FAIR) plan, following a spate of brush fires and riots in the state over the decade. (An insurer of last resort is an insurance company or government entity which provides insurance for entities which are considered high risk or uninsurable).”

• The Loss and Damage Fund – At COP27, it was agreed to create a fund that will help low-income developing countries offset the damage from natural disasters caused by climate change.
• Carbon Brief (2023) – An interview with Robert Van Lierop reflecting on the three-decade journey to a loss-and-damage fund. Countries negotiated the world’s first climate change treaty in 1991, which featured the word “insurance”. 

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Music: “Just Because Some Bad Wind Blows” by Nick Nuttall, Reptiphon Records. Available at https://nicknuttallmusic.bandcamp.com/album/just-because-some-bad-wind-blows-3

Producer: Podshop Studios

Huge thanks to Siobhán Foster, a vital member of the team offering design advice, critical review and organisation that we depend upon.

Stay tuned for more insightful discussions on navigating the transition away from fossil fuels to a sustainable future.