collaboration to confront climate risks
Economic losses from extreme weather events continue to climb, with insured losses rising
5–7% annually. Fires, droughts, heatwaves, and flooding now account for the greatest
economic and social damage worldwide, according to Climate Change: Extraordinary Risks and
Public Policies, a new report released by MAPFRE Economics at COP30 in Brazil.
The report highlights widening global insurance protection gaps. Asia faces the largest shortfall, with
82.8% of natural disaster losses uninsured; Latin America follows with an 81% gap. By contrast, North
America has the lowest gap at 43.2%, despite rising exposure to cyclones, winter storms, and
wildfires. These disparities stem from low insurance penetration in emerging markets, population
growth in high-risk zones, and the increasing frequency of extreme events.
Secondary perils – such as wildfires, heatwaves, floods, and storms – now account for more
than half of all disaster losses, driven in part by global warming. In 2024, climate-related
catastrophes caused more than USD 300 billion in economic losses for the ninth consecutive
year, with nearly USD 145 billion insured.
“Catastrophic insured losses have grown consistently for decades,” said Ricardo González,
Director of Analysis, Sectorial Research and Regulation at MAPFRE Economics. “Climate
change is a driver, but so are economic growth and increased development in vulnerable
areas.” He noted that Europe, now the world’s fastest-warming continent, saw a record
number of natural disasters in 2023.
MAPFRE’s report stresses that reducing the Nat Cat insurance gap requires coordinated action
between insurers and public authorities. Without stronger risk-management and
compensation mechanisms, some climate-related risks may become uninsurable.
The report calls for stronger public-private collaboration, citing models such as Spain’s
Insurance Compensation Consortium, as well as expanded use of prevention tools – early-
warning systems, risk-reduction incentives, and parametric insurance that pays out
automatically when predefined conditions (such as wind speed or rainfall levels) are met.
“Climate change is one of the greatest challenges to global stability and to the insurance
industry itself,” said Mónica Zuleta, MAPFRE’s Group Head of Sustainability. She reaffirmed
MAPFRE’s commitment to becoming carbon-neutral across all operations by 2030 and
reaching Net-Zero emissions in its insurance and investment portfolios by 2050.
MAPFRE is also advancing solutions that support decarbonisation and climate adaptation,
including coverage for renewable energy, electric mobility, and regenerative agriculture.
Initiatives highlighted at COP30 include the company’s investment in Blue Marble’s parametric
insurance solutions, the development of catastrophe bonds, the MAPFRE Renewable Energy II
Fund focused on biomethane, and Bioseguro, a new program supporting post-disaster
reforestation and natural regeneration while generating carbon credits.
