Climate risk is now a pressing business priority.
“It’s a rapidly changing environment,” said Sam Franks, country manager and head of partner engagement UK & Ireland at Beazley. “SMEs and large corporates alike must place climate change high on their agenda.” This urgency is reinforced by NASA data showing “2024 was the hottest year on record” - part of a decade-long trend of rising temperatures.
This climate shift fundamentally changes how insurers operate. Dan Cicchetti, senior director, client engagement, UK and Ireland at LexisNexis Risk Solutions, explained: “Insurers have been able to look at the past, but now, they’re trying to predict the future based on the information they have now.”
And it’s here at that insurance brokers come into play. “Brokers are in a key position, interfacing directly with consumers to support better, more accurate decisions - information insurers don’t always have at the point of underwriting”, Cicchetti said.
But what do brokers themselves need to know about the top risks and new resilience methods facing up to climate change?
A recent UK government report highlighted that “flooding is one of the most important climate challenges facing the UK.”
Kelly Ostler-Coyle, head of communications and stakeholder relations at Flood Re (a UK government-backed flood insurance scheme) highlighted the challenge of flood claims. “When Flood Re started, if you'd had a previous flood claim, it was really hard to get insurance... the premium, and the excess would be so high that it would be almost like self-insuring,” she said.
Addressing flood risk now requires a focus on long-term resilience. Ostler-Coyle stressed: “We need a housing stock that's going to be there in many years’ time, that isn't going to have to be continually rebuilt because of flooding.” She warned of the ripple effect of development on flood risk: “The more you build over, the less there is for the rain to absorb, so we need to be building with flood risk in mind... even if you protect one new area, it could run down the hill and affect a village that's never been flooded before.”
Flood Re’s Build Back Better scheme provides policyholders up to £10,000 for flood resilience upgrades—such as water-resistant walls, air brick covers, or flood doors—beyond standard repairs. Ostler-Coyle encouraged brokers to inform clients about the support available: “Brokers should advise clients that even if they haven’t been flooded yet, they might be... that they can start putting upgrades in place anyway.”
Brokers can support flood resilience by:
• Getting Flood Re accreditation
• Understanding Build Back Better and other resilience products
• Advising clients before flood events
• Promoting long-term resilient building and repair choices
While flood risk is largely localised, weather extremes like storms cause widespread disruption and economic loss. A Statistica report revealed storms have caused over $1 trillion in economic losses worldwide since 1995—the largest economic impact among natural disasters. Another Statistica report illustrated that the UK experienced 12 named storms from September 2023 to August 2024.
Nicola Dryden, Sedgwick’s chief client officer, said these conditions make insurance all the more essential. “Global warming is impacting the insurance industry overall, we need to make sure that we are delivering the customer experience and the service attached to that… when customers buy a policy, they are buying that reassurance that everything is going to happen in the right way,” she said.
Rising climate and economic pressures demand sharp, agile broker action. Key steps include:
• Make climate risk a core part of every client conversation
• Use real-time, predictive tools instead of relying on past data
• Apply geospatial intelligence for property-level risk assessment
• Promote resilience and risk reduction, not just insurance cover
• Stay informed and trained - courses like Flood Re’s enhance expertise
• Communicate clearly and confidently to reassure clients
• Proactively manage inflation’s impact on coverage and pricing
• Ensure compliance and uphold consumer duty amid evolving regulations
• Detect fraud early to maintain affordability
• Strengthen insurer ties and supply chain knowledge for smooth claims
• Help clients plan for disruptions and continuity during extreme events
Technology is helping insurers respond more precisely to climate risks. Geospatial intelligence utilises satellite imagery and flood maps to analyse risks far more precisely than postcode-level data. According to a Nature report, AI-driven geospatial models like Google DeepMind’s GenCast have surpassed traditional weather forecasting systems such as the European Centre for Medium-Range Weather Forecasts’ ENS.
In addition, a study for the ABI showed that flood defences guided by geospatial data reduced annual losses by 59%, saving £568 million. Cicchetti explained that such granular data enables insurers to “open up risks that probably, historically, would have been seen as undesirable” and expand their footprint. He added: “Companies can use location-based insights to guide clients introducing more resilient properties or even adapting their existing ones.” Brokers play a vital role too, by helping insurers “expand their footprint by being more detailed with the checks they’re performing on behalf of those insurers”, Cicchetti said.
To leverage geospatial intelligence effectively, brokers can:
• Use address-level geospatial tools to identify vulnerabilities (flood, subsidence, wildfire)
• Leverage predictive climate models to forecast threats
• Monitor localised climate trends to anticipate high-risk zones
• Recommend preventive property adaptations
• Stay updated on risk assessment technologies and climate science
• Collaborate with insurers to integrate forward-looking data
