Climate risk encompasses the physical, transition, and liability risks arising from climate change, affecting both sides of insurers’ balance sheets. On the underwriting side, it drives changes in hazard frequency and severity, reshapes insurability, and requires updated models and pricing. On the investment side, it influences asset values, sector exposures, and regulatory expectations for climate‑related disclosures. Integrating climate risk into strategy, capital planning, and product innovation is now a central task for boards and risk functions.
