Insurance market failures loom as insurers retreat from climate-impacted regions, leading governments to assume responsibility. Risk-sharing systems and insurance/capital markets are proposed to scale up Loss and Damage funding. The UK government integrates risk transfer into aid and development financing, aiming to enhance disaster resilience. Wealthy nations could provide $25 billion in annual protection against climate disasters for vulnerable countries, while poor and vulnerable countries are missing out on pre-arranged climate disaster finance.

Climate Risk and Insurance