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The EU Held a 'Climate Resilience Dialogue'. Here's What Came Out of It

The jaw-jaw resulted in a long list of proposals, but little clarity on how to close the continent's protection gap

Author

Louie Woodall
October 10, 2024

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TL;DR

  • The European Commission convened a Climate Resilience Dialogue (CRD) involving 17 participants from the worlds of regulation, insurance, and business

  • Its purpose was to talk about ways to harden the EU against climate shocks and narrow the “protection gap” between insured and uninsured losses

  • The CRD’s final report features over a dozen proposed actions, from exploring public-private partnerships to improving climate risk measuring and monitoring

  • Big ticket solutions like mandatory insurance face hurdles to implementation, however

  • There was also little in the report on how to spur climate adaptation investment, which is key to lowering insured losses and maintaining insurance affordability

Talking about our problems is healthy. It’s advice the European Commission clearly took to heart when it founded the Climate Resilience Dialogue (CRD), a two-year conversation among a ‘Who’s Who’ of regulators, insurance groups, and trade associations. Its purpose: to find ways to bolster Europe’s climate resilience and narrow the “climate protection gap” — the gulf between insured and uninsured losses from climate-driven natural disasters.

The gabfest wrapped up in July with the publication of a 111-page final report stuffed full of proposed actions and areas for further study. Now, it’s up to member states and Ursula von der Leyen’s new European Commission to decide what to do with them. The Commission President herself has made clear that climate-proofing Europe is a focus, stating in her roadmap for the next five years that “we must step up work on climate resilience and preparedness.”

They shouldn’t dilly-dally for long. Europe has been heating up at twice the global rate and is under assault from climate-related risks of all kinds. The most recent climate risk assessment found the continent is exposed to 36 climate risks with “potentially severe consequences”. Moreover, in the period 1980-2022 only around one-quarter of some €650bn (US$711bn) of economic losses from natural disasters were insured. That’s quite the protection gap. In some countries, like Greece and Italy, the gap is even wider because of low insurance penetration and high climate risk exposure.

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