Global Insurance Law Connect (GILC), an international network of law firms specialising in insurance and reinsurance, has published its inaugural Property Catastrophe and Climate Governance Report, drawing on contributions from 23 member firms worldwide.
GILC’s research underscores the increasing impact of climate change on both insured and uninsured losses and emphasises the importance of government schemes and insurance innovations in strengthening resilience.
The analysis highlights how rising costs from catastrophic events, driven by more frequent and severe weather, urban expansion, and shifting land use—are creating significant strains on property insurance markets globally.
Gillian Davidson, Chair of GILC, said: “Our new property catastrophe report captures the urgency of the protection gap challenge. As climate-driven perils intensify, insurers, governments and property owners are all grappling with the affordability and availability of insurance, particularly in high-risk areas. Building resilience is not just a technical challenge, but a societal imperative.”
According to GILC, market pressures are leading to tighter policy conditions, more exclusions, and, in some high-risk regions, insurers withdrawing from coverage entirely. Governments are increasingly implementing regulatory reforms to maintain insurability and protect communities.
Despite these challenges, GILC identifies encouraging trends, including clearer policy language, greater incentives for risk mitigation, and wider adoption of co-insurance and parametric solutions, which enable faster recovery following catastrophic events.
The report highlights parametric insurance, catastrophe risk pools, and technology-driven risk assessment as key mechanisms to address the protection gap, providing faster claims settlement, coverage for hard-to-insure events, and greater certainty for policyholders.
GILC emphasises that the insurance sector has a critical role in shaping a more resilient and sustainable future, and that collaboration, innovation, and risk mitigation are central to helping communities withstand and recover from natural disasters.
Davidson added: “The growing collaboration between all parties worldwide offers real hope that we can proactively manage natural disaster risk while maintaining the financial stability of communities and markets.”
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