Climate and Sustainability Roundup: Resilience, resilience, resilience...

By Joshua Geer

Do you remember when sustainability in insurance could be as simple as painting the office green, commissioning a glossy report and proclaiming climate leadership? Those days now feel quaint.

In a world of political polarisation, heightened greenwashing fears and rising climate scepticism, insurers have shifted their public focus to one thing that sells across political divides and sits at the heart of their business: resilience.

This is, of course, what insurers have been doing for decades – absorbing shocks, spreading risk and paying out claims after disasters – but this month, and indeed this year, has been a clear example of the industry making a deliberate effort to communicate that role more explicitly, more consistently, and to position resilience as its core sustainability story.

The urgency message was underscored in late July by Allianz's Günther Thallinger, who warned that the combination of ecosystem collapse, erratic water cycles and societal division is creating a risk environment that could one day be "impossible" to manage. Allianz positioned itself as committed to long-term societal transformation with a focus on hard-headed resilience.

International bodies are also reframing their positions on climate resilience.

In mid-July, the Financial Stability Board (FSB) dialled back its ambitions for prescriptive climate regulation, opting for a year-by-year, project-led approach. Critics called it a "sharp retreat", but the FSB is still keeping insurers centre-stage and recognising their role in tackling protection gaps.

That softer line sparked swift responses from the International Association of Insurance Supervisors (IAIS) and the European Insurance and Occupational Pensions Authority (Eiopa), both of which explicitly reaffirmed their climate risk work.

The IAIS stressed that without coordinated action, climate-related physical risks will continue to rise and protection gaps will widen. Meanwhile, Eiopa underlined that climate-related disasters are becoming more frequent and damaging, and its own supervisory work will continue unabated.

On 18 July, Andrew Bailey, the FSB chair and Bank of England governor, picked up the resilience baton, describing the body as a "can-do" organisation on climate and pointing to the UK's Flood Re, which the FSB helped develop, as a model for keeping cover available in high-risk areas.

That was timely, as just days later, Flood Re revealed it is facing record claims and a £100m ($135m) jump in reinsurance costs, driven by more severe events and storms like Bert. The scheme is already experimenting with solutions like catastrophe bonds to keep its model sustainable.

The same week, Eiopa added a technical note of caution, publishing a study showing insurers' climate scenario analysis in their ORSAs is still patchy. While scenario testing has improved since 2021, approaches remain inconsistent, with some firms relying on overly simplified assumptions.

The past month has also shown that resilience planning is happening at national and sector levels. Mid-July saw three-quarters of Italy's insurers join a new natcat pool, backed by mandatory business cover and public-private reinsurance, marking a shift from post-disaster aid to proactive risk-sharing.

The Global Federation of Insurance Associations also weighed in, arguing insurers should be directly involved in land-use planning to reduce exposure before disasters strike. And in South Africa, actuaries unveiled a framework to help life and health insurers link extreme climate events to health outcomes.

All of this comes against a brutal backdrop. Aon estimates that natural disasters caused $100bn in insured losses in the first half of 2025 alone, the second-highest H1 on record. That's before we even consider the possibility - now openly discussed by Gallagher Re - of the first $200bn insured loss year.