climate risk

While the 2025 Atlantic hurricane season is projected to be more active than average, the fundamentals of the insurance-linked securities (ILS) market remain strong, according to François Divet, Head of ILS at AXA Investment Managers (AXA IM).

As South Asia faces escalating threats from extreme weather events, the World Bank Group is urging policymakers to scale up innovative financial tools such as weather-index insurance to help households and businesses manage climate risks more effectively.

Catastrophe bonds and other private market risk-transfer tools are essential to help Europe’s agriculture sector manage mounting climate risks, according to Howden, as annual weather-related losses are expected to rise to €40 billion by 2050.

African Risk Capacity Limited (ARC Ltd) and Klapton Reinsurance Limited (Klapton Re) have signed a Memorandum of Understanding (MoU) to establish a new partnership aimed at expanding access to parametric climate insurance solutions across Africa.

According to global specialty insurance and reinsurance group Chaucer, evidence from observational data and climate models shows that tropical cyclones, known as typhoons in the Pacific, are showing signs of being influenced by climate change, with a notable trend of their peak intensity shifting northward in the Northwest Pacific.

According to Twelve Securis, the specialist insurance-linked securities (ILS) manager, the combination of advancements being seen in catastrophe modeling, along with shifting climate patterns, and the ability to generate uncorrelated returns, is making ILS an increasingly attractive investment amid a rapidly changing risk landscape.

Parameter Climate, the parametric climate and weather risk transfer focused underwriter and advisor, has announced the formation and launch of a Bermuda-based transformer vehicle named Parameter Capital Bermuda Ltd, as the company looks to broaden access to its deals and syndicate parametric risk to non-traditional capital.

COP 29, the United Nations Climate Change Conference held in Baku, Azerbaijan, has drawn to a close with agreement on certain areas and progress being made on the much-discussed Loss and Damage, as well as the Global Shield, two programs of some relevance to insurance, reinsurance and insurance-linked securities (ILS) markets.

A joint report published by insurance giant Generali and the United Nations Development Programme (UNDP) highlights parametric risk transfer and insurance as a key solution that can help to close the US $1.8 trillion protection gap.

The Chicago Mercantile Exchange (CME Group) has expanded its range of weather risk transfer products, with the recent launch of seasonal strip weather futures and options contracts.