Climate change has been a driver of market innovation, policy engagement and analysis, and is now stimulating new regulatory approaches for insurance in many countries.
An energy transition is first necessary in terms of environmental sustainability, but may also involve economic opportunities: for example, according to a study of New Climate Institute4 , if China, the United States and Europe would accomplish energy transition to renewable sources by 2050, they could benefit 3 million additional jobs by 2030, in addition, the reduction in imports of fossil fuel would result in an annual savings of up to 520 billion dollars. Evidence shows that, depending on their size, assets under management, and their core activities, insurance firms have started identifying climate change among the for insurance looking forward to the next decades. However, major gaps still remain among insurance companies to address this challenge, such as market failures, misaligned policy frameworks, underdeveloped markets, as well as gaps in critical capabilities. A broader, more comprehensive action from across the entire insurance industry is needed and expected by stakeholders.