The objectives of this Issues Paper are to raise awareness for insurers and supervisors of the challenges presented by climate change, including current and contemplated supervisory approaches for addressing these risks.
As an Issues Paper, it provides an overview of how climate change is currently affecting and may affect the insurance sector now and in the future, provides examples of current material risks and impacts across underwriting and investment activities, and describes how these risks and impacts may be of relevance for the supervision and regulation of the sector. It explores potential and contemplated supervisory responses, and reviews observed practices in different jurisdictions. In doing so, it identifies gaps and emerging areas which need to be resolved to allow for effective supervision. Finally, the paper offers preliminary insights from practice, and initial conclusions relating to the supervision of climate change risks to the insurance sector.
The Paper is intended to be primarily descriptive and is not meant to create supervisory expectations. Nevertheless, the Paper may shed light on the need for additional, more specific joint material from the IAIS and the SIF to support supervisors in their efforts to better understand and address climate change risks.
