A New Hurricane Catastrophe Swap, Canada's Adaptation Failings, Wildfire App Watch Duty Upgrade, and More

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The Inter-American Development Bank (IDB) arranged its first catastrophe swap, shifting a slice of Belize’s hurricane risk to private reinsurance capital providers via Swiss Re. The deal gives Belize faster access to emergency funds after major storms, without adding to its debt load.

The parametric insurance coverage runs from August 1, 2026 through May 31, 2028 and pays out once pre-agreed hurricane triggers are met. Total coverage via the swap amounts to US$20mn, capped at US$10mn per policy year.

The deal marks IDB’s first swap under its Financial Instruments for Resilience program, part of the Ready and Resilient Americas initiative. It offers a template other Latin American and Caribbean nations could use to transfer disaster risk to global markets and secure rapid liquidity.

The swap adds to Belize’s existing resilience financing stack, which includes a US$25mn contingent credit facility for natural disasters and US$118mn in loans carrying climate resilient debt clauses that let the country defer principal repayments for two years after a qualifying disaster. France’s climate fund and the Belize government are contributing towards the swap’s premium.

Catastrophe swaps are a niche, but attractive, natural disaster risk transfer mechanism for governments. Three years ago, the World Bank executed a joint catastrophe bond and swap transaction for Chile that provided US$630mn of earthquake insurance coverage. 

Singapore is weighing a US$500mn fund to boost climate resilience across Southeast Asia’s food supply chains, Bloomberg reports. The Monetary Authority of Singapore would set up the vehicle, which would target agriculture and aquaculture adaptation projects that currently struggle to attract capital. A launch could come as early as next year, though the fundraising target remains unsettled. The structure would draw development finance institutions and private capital, with philanthropic foundations providing concessional capital to de-risk investments for commercial banks. (Bloomberg)

The Swiss Re Institute calculated US$42bn of global insured natural catastrophe losses for the first half of 2026 — 16% below the 10-year average and the lowest first-half tally since 2020. Severe convective storms drove roughly US$28bn of the total, below trend in large part because of their geography. US storm activity ran above average but largely spared Texas, the Southern Plains, and the Southeast, where insured-asset concentrations turn storms into major losses. The Institute warned underwriters against complacency on disaster risk, highlighting data showing the second half of the year typically accounts for 58% of global insured losses. (Swiss Re)

Climate risk could strip US$388bn from global data center values — equivalent to 38% of asset values — without adaptation, Allianz Commercial reports. Data from Schneider Electric shows business interruption accounts for around one-third of these modeled losses, with more than 90% of all losses originating from upstream supply chain disruptions rather than direct physical damage to centers themselves. (Allianz Commercial)

Wildfires in the US threaten some 2.5 million properties representing US$1.4trn in reconstruction cost value, according to a new report from Cotality. California has the most exposed market, with 1.28 million homes at moderate-or-greater risk worth US$850bn in reconstruction costs. Los Angeles, Riverside, and San Diego are the cities with the most at-risk properties in the Golden State. However, nearly half of all at-risk properties (49.9%) sit outside California, with Colorado and Texas alone accounting for some 560,000 properties and US$252bn in value. (Cotality) 

France’s summer heatwaves could cost the country €10-15bn (US$11.5-17.4bn) in direct and indirect losses, environment minister Monique Barbut said last Wednesday. The estimate, drawn from statistics agency INSEE, nearly triples the €5.6bn (US$6.5bn) toll from the 2022 drought. (Reuters)

Moody's mapped US industrial exposure to compounding heat and water stress, finding roughly 49,000 water-intensive facilities are projected to shift from low or moderate into high or very high water stress by 2100 under a high-emissions scenario. Texas and California hold the largest concentrations. These facilities could drag on investor returns, as increased heat and water stress could push up operating costs, make earnings more volatile, and in some cases cause entire sites to become ‘stranded’ — assets that lose all their economic value. (Moody’s)

The UK government unveiled a £65mn (US$88mn) support package for farmers following England’s driest July on record. The measures add £50mn (US$68mn) to the Sustainable Farming Incentive — which rewards farmers for taking actions that support food production while protecting the environment — and up to £15mn (US$20mn) for on-farm reservoirs to help growers secure water and keep livestock fed amid failing pasture. The announcement follows UK Prime Minister Andy Burnham’s chairing of the government’s emergency response committee amidst ongoing extreme heat and drought conditions. (UK Government)

Massachusetts Governor Maura Healey announced US$45mn in grants for 97 climate resilience projects last Thursday — funding dam removals, cooling corridors, and flood retrofit programs. The grants were disbursed via the state’s Environment & Climate (ECO) One Stop program and are part of a statewide climate adaptation plan to lower risk and harden communities amidst escalating extreme weather. (Massachusetts Government)

More than a third of the Asian Infrastructure Investment Bank’s (AIIB) sovereign borrowers face credit downgrades by 2050 if climate policy stalls, the lender disclosed in its latest sustainability report. Assuming global warming tops out at 2.9°C, 34% of its sovereign portfolio would suffer downgrades. In contrast, a 1.5°C-aligned pathway would see that cut to 11%. The AIIB directed 71% of 2025 financing — US$7.47bn — to climate projects, of which 27% were for adaptation. (AIIB)

Canada’s first National Adaptation Strategy progress report shows the country is “falling behind” on its climate-proofing efforts, the Canadian Climate Institute (CCI) has said.

While the federal government has committed over C$2.1bn (US$1.5bn) since 2022 to adaptation programs spanning disaster resilience, infrastructure, and health systems, the return on investment appears limited so far.

“The Progress Report highlights important forward movement, including a wide range of federal programs, tools, funding, and co-ordination efforts underway across the country. What’s missing is clear evidence that these initiatives are reducing climate risk in a meaningful way at a national level. By tracking programs rather than results, the progress report paints an overly optimistic picture of success,” said Ryan Ness, Director of Adaptation at CCI. 

The federal government's own report shows mixed results. Municipal adaptation costs are estimated at C$5.3bn (US$3.8bn) per year, with current funding described as inadequate to the scale of need. Bilateral coordination with provinces and territories has advanced with just a few jurisdictions.

Other initiatives, while successfully launched, have serious gaps. The government has missed its target of having 50% of Canadians take “concrete actions to better prepare for and respond to climate change risks facing their household”, while around 1.5 million Canadian households remain effectively uninsurable against flood risk.

Moreover, while Ottawa maintains that 100% of new federal infrastructure funding now factors in climate resilience, the CCI says implementation remains inconsistent. “[T]hose requirements are inconsistently applied and do not prevent funding being used for development in high risk areas,” said Ness.

In Brief

The National Academies of Sciences, Engineering, and Medicine has scrubbed the climate science chapter from its Reference Manual on Scientific Evidence as it undertakes an independent review of the processes used to draft it, removing an important primer federal judges use to weigh disputed climate evidence. The move follows pressure from President Trump, who branded the guide “fraudulent, biased, and misleading” in July. (New York Times)

The National Oceanic and Atmospheric Administration (NOAA) will no longer coordinate the Arctic Report Card, ending two decades of federal backing for the peer-reviewed analysis on sea ice, wildlife, and permafrost in the region. The agency gave scientists no explanation before withdrawing support last Monday, cutting off hosting and staffing for this year’s edition. NOAA says it will keep collecting and releasing the underlying data. (CNN)

Germany’s environment minister Carsten Schneider will propose a constitutional amendment giving Berlin authority over climate adaptation, he said, targeting the second half of the year for a formal plan. The move would reclassify adaptation as a “joint task”, allowing the federal government to supply money and other resources for climate-proofing measures. Currently, adaptation is primarily in the domain of states and municipalities. The amendment needs a two-thirds parliamentary majority, requiring Left Party support that chancellor Friedrich Merz’s CDU/CSU bloc has so far withheld. (Clean Energy Wire / Tagesschau)

Only 20 of the UK’s Department for Environment, Food and Rural Affairs (DEFRA) 6,613 staff work on climate adaptation — 0.3% of the agency tasked with protecting England’s environment and food security — The Guardian reports. Campaigners call staffing levels grossly inadequate as wildfires and drought intensify nationwide. (The Guardian)

New Zealand’s Climate Change Commission warned last Tuesday that unresolved funding decisions are leaving communities “in limbo” on adaptation, with progress “patchy” against fast-growing risk. The group made six recommendations, including having central government set up “funding and financing pathways” for local adaptation action and ensuring the next country-wide adaptation plan — due in 2028 — “has goals and objectives that will drive action at the pace and scale needed”. (New Zealand Climate Change Commission)

Massachusetts has named Katie Schlick its first statewide heat resilience officer, becoming the second US state after Arizona to create a dedicated extreme heat role. Schlick previously served as a resilience policy lead at the US Climate Alliance and a special assistant to the White House National Climate Advisor. In her new role, she will coordinate agencies and communities on preparing for rising temperatures and protecting public health, reporting jointly to the state climate chief and public health commissioner. (WBUR)

The United Nations Convention to Combat Desertification (UNCCD) convenes this week for COP17, where the focus of the nearly 200 countries attending will be how to operationalize the US$12bn Riyadh Global Drought Resilience Partnership — pledged over seven years to help 74 vulnerable countries manage drought and land degradation. The sum is dwarfed by the roughly US$2.6trn the UNCCD estimates is needed cumulatively by 2030 to repair degraded land and restore soils, underscoring how far drought finance lags the scale of exposure. (The Guardian)

Watch Duty, the non-profit wildfire and flood alert platform, is layering satellite imagery from Planet Labs into a new range of enterprise tools for utilities and infrastructure operators. Pacific Gas and Electric Company has become the first customer to deploy the feature, gaining weekly satellite-sourced insights to evaluate vegetation conditions, gauge changes to terrain, and support incident response. 

The partnership closes a blind spot in wildfire risk management. While most commercial satellite mapping tools lag ground conditions by months or years, Planet’s weekly imagery provides utilities with a near-real-time view of on-the-ground changes that could elevate wildfire risks.

“Our teams rely on timely, accurate information to understand wildfire events and conditions in the field. Having access to more current satellite imagery alongside our infrastructure in Watch Duty helps us build a more complete picture, make informed decisions and continue strengthening our wildfire mitigation efforts,” said PG&E Wildfire Mitigation Vice President Andy Abranches.

Watch Duty and Planet plan to expand the partnership to other infrastructure operators and disaster-response applications.

NOAA is paying two private satellite companies US$6.4mn to help improve weather forecasts. Spire Global will collect atmospheric data by tracking how GPS signals bend as they pass through the air — a technique that reveals temperature, pressure and humidity at different altitudes. PlanetiQ will supply similar data, plus measurements of the atmosphere’s electrically charged upper layer, which affects satellite and radio communications. The contracts run through early December and feed directly into forecasting models used by NOAA, NASA, and the military. (NOAA)

Indian start-up InRisk Labs raised US$27mn in a Series A round led by Bessemer Venture Partners and Northpoint Capital, capital it will funnel into catastrophe modeling and climate risk underwriting. The company makes technology for creating parametric insurance solutions that address extreme weather events. Alongside the raise, subsidiary EarthRe has obtained a reinsurance license from India’s International Financial Services Centres Authority, which allows it to underwrite natural catastrophe, climate, and crop risk through a regulated balance sheet. (Inc42)

A new open dataset could enhance early-warning systems for extreme heat, drought and storm risk. Start-up Planette has released 46-day forecasts and reforecasts from its Integrated Forecasting System free via Amazon Web Services’ Open Data platform, using Earthmover’s Icechunk cloud-native format. The reforecast archive spans 2006 to 2025, and includes 10 ensemble members alongside atmospheric, surface and ocean variables. Subseasonal prediction — the 2-to-6-week window between weather and seasonal forecasting — remains notoriously difficult, but wider access could help researchers benchmark model skill and let planners and insurers probe predictability further ahead of extreme events. (Planette)

El Niño is strengthening, with a greater than 90% chance of a very strong event during the Northern Hemisphere fall and winter 2026-27 (NOAA)

State of the Climate in 2025 (Bulletin of the American Meteorological Society)

Faster, bigger, more severe: Extreme wildfire spread sets the stage for forest ecosystem change in western and boreal North America (Science Advances)

How public attention drives urban climate governance across mitigation and adaptation: evidence from Chinese cities (Scientific Reports)

Upgrading slums as pathway to climate resiliency: evaluating urban infrastructure impact on health during heatwaves (npj Urban Sustainability)

Employment sectoral differences of public service disruptions and psychological distress among US workers after disasters: A Cross-Sectional Study (Safety and Health at Work)

Thanks for reading!

Louie Woodall
Editor