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Societal Resilience Programme

ClimateWise’s Societal Resilience Programme seeks to directly address the climate-risk protection gap. It identifies opportunities where insurers can support societal resilience to the impacts of climate change right across the financial markets and society more broadly. The focus is on the industry’s risk carrying, risk managing and investment activities. Three distinct, yet interconnected research pillars underpin the Societal Resilience Programme: financial markets, regulation, and resilient cities.

As the frequency of climate-related catastrophes continues to grow, the economic losses attributed to climate change, are also rising rapidly. However, a widening gap has emerged between the total economic losses attributed to climate perils, and those losses covered by insurance. Today, the climate risk protection gap stands at over $100bn per annum. (Swiss Re, 2016, This protection gap presents the insurance industry with several challenges, including loss of market share and an undermining of the traditional role insurance has played, as society’s risk manager.


Financial markets

With over $30 trillion of financial assets, the insurance industry is one of the largest institutional investors. The industry could therefore manage this significant pool of invested assets in ways that also help to manage risk on the underwriting side of its business. The research stream actively explores what the commercial opportunities for such strategies are, what tools and standards are required and how the industry can collaborate more effectively with other stakeholders across the financial markets, to improve societal resilience to climate risk.

Investing for Resilience (2016)

This report explores how the global insurance industry can play a more proactive role in supporting the transition to a more climate-resilient society. It aims to align the industry’s own investment activities with risk reduction opportunities, as well as supporting other parts of the financial system in its response to climate risk. It finds that the insurance industry, with its wide array of stakeholders and involvement in so many spheres of economic activity, is well placed to help lead and co-ordinate increased investments in resilience. This could lead to many new commercial opportunities for the industry.



Given the insurance industry’s unique understanding of risk, it can play an important role in supporting global financial regulators to fully understand the nature of the physical, transition and liability risks associated with climate change. Furthermore, with tweaks to the regulatory framework, the industry can be empowered to support other parts of the financial system in their response. This area is informed by the ClimateWise Insurance Advisory Council, a senior-level council established to provide direct support and guidance to ClimateWise’s ongoing collaboration with global regulators.

Insurance regulation for sustainable development (2015)

This report assesses the role of insurance regulation in protecting the basic human rights of life, livelihood and shelter against natural hazards and climate risk. Effective insurance regulation facilitates improved access to insurance (both traditional and alternative). This in turn increases the resilience of communities, fulfils human rights duties of both state and non-state actors and supports the UN Sustainable Development Goals.

The impact of climate change on the UK insurance sector (2015)

ClimateWise collaborated with the Bank of England’s Prudential Regulation Authority (PRA) to inform its study into impacts of climate change for the insurance sector and was the first example of a regulator globally examining such risks. ClimateWise convened representatives from the PRA together with insurance industry representatives, academics and other specialists to explore the nature of the physical, transition and liability risks the report flags.

The ClimateWise Insurance Advisory Council (2016– )

This Council of C-suite executives from across the global insurance industry was convened to strengthen the insurance industry’s voice on the mitigation of and adaptation to climate change. The Council’s purpose will be to leverage the specific capabilities of the University of Cambridge and its strategic partners to help strengthen industry support for regulators, policymakers and other stakeholders as they consider ways to promote more systematic responses to climate change right across the financial system. A number of research commissions are expected.


Resilient cities

The insurance industry has an important role to play in helping global cities address the myriad challenges they face from increased exposure to climate risks. The focus is on supporting urban resilience in both developing and developed economies with a particular emphasis on development decisions and large public infrastructure projects and the influence this can have on the systemic risk cities face. The research theme explores the insurance industry’s value chain to identify where it can support cities to make better, more informed infrastructure and development decisions. This, in turn, is likely to increase commercial opportunities for the industry. This includes making full use of the industry’s data, leveraging its asset management activities and increasing its influence over a wider cross-section of stakeholders, not only clients.

This study highlighted how city adaptation to climate risk is of crucial importance to a wide variety of stakeholders, especially the insurance sector. The study found direct links between enhanced climate resilience and increased investor confidence. This leads to improved investor sentiment and sustainable growth, in turn creating a wealth of new opportunities for both cities and the insurance sector. The report introduces ‘resilience zones’. These are geographically bounded areas, within cities, that are particularly vulnerable to climate risk. By focusing on resilience zones helps cities to concentrate and prioritise the market conditions necessary for promoting investment opportunities. 

Resilient cities (Phase II): Resilience Zones (2017)

Phase II of Resilient Cities further develops understandings of Resilience Zones. It explores how the insurance industry can support urban resilience by leveraging existing capabilities across their value chain. It focuses on property development and infrastructure investment as, by matching assets to liabilities, the insurance sector supports the efficient allocation of capital and contributes to the financing of assets that underpin the wider economy (eg infrastructure investments). Via long-term engagement between insurers and cities, it will help to diversify the financial system and ultimately help to manage the widening climate risk protection gap.

The City Innovation Platform (CIP) (2017)

One of the challenges facing investors and insurers, when underwriting emerging economy public infrastructure projects, is that the industry is often only involved towards the end of the development process. This is ironic as the finance sector is often most exposed to project risks over the long term. Consequently, many infrastructure projects are unsustainable, uninsurable and fail to meet the needs of local communities. However, insurer expertise could support more informed infrastructural decision-making and planning. This project explores how emerging economy infrastructure projects can be reimagined, to integrate the finance sector more closely, from the outset. It aims to develop a methodology that can support more bankable, insurable and sustainable infrastructure projects that meet the needs of local communities.






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