The Role of the Insurance Sector in Climate Finance: Risk Transfer, Resilience, and Capital Allocation

Öz

Climate finance debates have traditionally centered on public budgets, development finance institutions, and capital markets, while the role of the insurance sector has remained comparatively underexamined in an integrated manner. Existing studies address insurance in relation to climate risk, catastrophe coverage, adaptation, investment, and financial governance; however, but these perspectives are seldom integrated into a unified climate finance framework. This review article examines the role of the insurance sector in climate finance through three core dimensions: risk transfer, resilience, and capital allocation. It argues that this tripartite structure captures the sector’s most climate-finance-relevant functions more coherently than fragmented categorizations because it reflects insurers’ role in providing financial protection against loss, shaping adaptive capacity and recovery, and directing long-term investment. The article further argues that risk pricing, modelling, and the production of climate information should not be treated as a standalone pillar, but rather as a cross-cutting function that supports and underpins all three dimensions. Reviewing the literature across climate adaptation, disaster risk finance, institutional investment, and insurance governance, the article identifies both the opportunities and structural limits of insurance-led climate finance. It concludes that the insurance sector can be understood as a strategically important but institutionally bounded actor within climate finance, especially in adaptation and resilience, whose contribution depends on supportive public policy, regulatory coordination, and layered risk-sharing systems.

Anahtar Kelimeler

• Climate Finance
• Insurance Sector
• Risk Transfer
• Resilience
• Capital Allocation

Sigorta Sektörünün İklim Finansmanındaki Rolü: Risk Transferi, Dirençlilik ve Sermaye Dağılımı

Öz

İklim finansmanı tartışmaları geleneksel olarak kamu bütçeleri, kalkınma finansmanı kuruluşları ve sermaye piyasaları etrafında şekillenmiş; buna karşılık sigorta sektörünün rolü bütüncül bir çerçevede görece daha az incelenmiştir. Mevcut çalışmalar, sigortayı iklim riski, afet teminatı, uyum, yatırım ve finansal yönetişim gibi farklı başlıklar altında incelemektedir; ancak bu yaklaşımlar çoğu zaman birleşik bir iklim finansmanı çerçevesi içinde bir araya getirilmemektedir. Bu derleme makalesi, risk transferi, dirençlilik ve sermaye tahsisi olmak üzere üç temel boyut üzerinden iklim finansmanında sigorta sektörünün rolünü incelemektedir. Çalışma, bu üçlü yapının sektörün iklim finansmanı bakımından en önemli işlevlerini parçalı sınıflandırmalara kıyasla daha tutarlı biçimde yansıttığını savunmaktadır; zira bu yapı, sigortacıların kayıplara karşı finansal koruma sağlama, uyum kapasitesi ile toparlanma süreçlerini biçimlendirme ve uzun vadeli yatırımları yönlendirme konusundaki rolünü yansıtmaktadır. Makale ayrıca, risk fiyatlaması, modelleme ve iklim bilgisinin üretilmesinin bağımsız bir sütun olarak değil, söz konusu üç boyutun tamamını destekleyen ve temellendiren kesişen bir işlev olarak değerlendirilmesi gerektiğini ileri sürmektedir. Uyum, afet risk finansmanı, kurumsal yatırım ve sigorta yönetişimi alanlarındaki literatürü gözden geçiren çalışma, sigorta temelli iklim finansmanının hem sunduğu fırsatları hem de yapısal sınırlılıklarını ortaya koymaktadır. Sonuç olarak sigorta sektörü, özellikle uyum ve dirençlilik alanlarında, iklim finansmanı içinde stratejik öneme sahip; ancak kurumsal sınırlarla çevrili bir aktör olarak konumlanmaktadır. Bu katkının etkili biçimde ortaya çıkabilmesi ise destekleyici kamu politikalarına, düzenleyici eşgüdüme ve katmanlı risk paylaşımı mekanizmalarına bağlıdır.

Anahtar Kelimeler

• İklim Finansmanı
• Sigorta Sektörü
• Risk Transferi
• Dirençlilik
• Sermaye Dağılımı

Kaynakça

1. Climate Policy Initiative. (2021). Building climate resilience in cities through insurance. https://www.climatepolicyinitiative.org/publication/building-climate-resilience-in-cities-through-insurance/ (Accessed: 20/08/2025)
2. Zhang, D., Mohsin, M., Rasheed, A. K., Chang, Y., & Taghizadeh-Hesary, F. (2023). Climate finance: What we know and what we should know? Economic Analysis and Policy, 77, 759–782.
3. IPCC. (2022). Climate change 2022: Mitigation of climate change. Contribution of Working Group III to the Sixth Assessment Report of the Intergovernmental Panel on Climate Change. Cambridge University Press.
4. Seçkin Codal, K., & Codal, A. (2022). Sosyal medyada iklim değişikliği tartışmaları. Efe Akademi Yayınevi.
5. OECD. (2023). Enhancing the insurance sector's contribution to climate adaptation. Enhancing the insurance sector’s contribution to climate adaptation, OECD Business and Finance Policy Papers, OECD Publishing, Paris.
6. Geneva Association. (2021). Climate change risk assessment for the insurance industry. https://www.genevaassociation.org/sites/default/files/climate_risk_web_final_250221.pdf (Accessed: 24/08/2025)
7. Nobanee, H., Dilshad, M. N., Abu Lamdi, O., Ballool, B., Al Dhaheri, S., AlMheiri, N., Alyammahi, A., & Alhemeiri, S. S. (2022). Insurance for climate change and environmental risk: A bibliometric review. International Journal of Climate Change Strategies and Management, 14(5), 440–461.
8. Nobanee, H., & Nghiem, X.-H. (2024). Climate catastrophe insurance for climate change: What do we know and what lies ahead? Current Opinion in Environmental Sustainability, 66, 101395. https://doi.org/10.1016/j.cosust.2023.101395

9. Gupta, A., & Venkataraman, S. (2024). Insurance and climate change. Current Opinion in Environmental Sustainability, 67, 101412.
10. Golnaraghi, M. (2018). Climate change and the insurance industry: Taking action as risk managers and investors. The Geneva Association.https://www.genevaassociation.org/sites/default/files/research-topics-document-type/pdf_public/ climate_change_and_the_insurance_industry_-_taking_action_as_risk_managers_and_investors.pdf (Accessed: 10/09/2025)
11. Ameli, N., Drummond, P., Bisaro, A., Grubb, M., & Chenet, H. (2020). Climate finance and disclosure for institutional investors: Why transparency is not enough. Climatic Change, 160, 565–589.
12. Rothwell, M., Earle, M., Ooi, C. H., Orr, J., Shroff, S., & Siew, J. (2020). Practical guide to climate change for general insurance practitioners. British Actuarial Journal, 25, e18.
13. OECD. (2025). Scaling finance and investment for climate adaptation. OECD Publishing. https://www.oecd.org/content/dam/oecd/en/publications/reports/2025/07/scaling-finance-and-investment-for-climate-adaptation_be6892fb/eeec8b52-en.pdf (Accessed: 16/11/2025)
14. Surminski, S. (2013). The role of insurance risk transfer in encouraging climate investment in developing countries. In P.-M. Dupuy & J. E. Vinales (Eds.), Harnessing foreign investment to promote environmental protection (pp. 228–250). Cambridge University Press.
15. United Nations Environment Programme Finance Initiative & Principles for Sustainable Insurance Initiative. (2021). Guidance on the Task Force on Climate-related Financial Disclosures (TCFD) for the insurance sector. https://www.unepfi.org/psi/wp-content/uploads/2021/01/PSI-TCFD-final-report.pdf (Accessed: 11/10/2025)
16. Le Quesne, F., Tollmann, J., Range, M., Balogun, K., Zissener, M., Bohl, D., Souvignet, M., Schuster, S., Zwick, S., Phillips, J., Wehnert, B., & Kreft, S. (2017). The role of insurance in integrated disaster and climate risk management: Evidence and lessons learned. Munich Climate Insurance Initiative. https://www.shareweb.ch/site/DRR/Documents/ Types%20of%20activity/Risk%20Transfer/Report_Insurance_Integrated_Disaster_Climate_Risk_Management_2017_GIZ_English.pdf (Accessed: 19/09/2025)
17. UNDP. (2025). Climate and disaster risk finance and insurance (CDRFI) in national adaptation plans and nationally determined contributions: Analytical report. United Nations Development Programme. https://climatepromise.undp.org/ sites/default/files/research_report_document/CDRFI%20in%20NAPs%20and%20NDCs_26%20June.pdf (Accessed: 16/11/2025)
18. Balogun, K. (2014). Applicability of risk transfer tools to manage loss and damage from slow-onset climatic risks. Procedia Economics and Finance, 18, 710–717.
19. Jakubik, P., & Uguz, S. (2021). Impact of green bond policies on insurers: Evidence from the European equity market. Journal of Economics and Finance, 45(2), 381–393.
20. Giuzio, M., Rousová, L., Kapadia, S., Kumar, H., Mazzotta, L., Parker, M., & Zafeiris, D. (2025). Climate change, catastrophes, insurance and the macroeconomy. European Economic Review, 173, 105210.
21. Cleary, P., Harding, W., McDaniels, J., Svoronos, J.-P., & Yong, J. (2019). Turning up the heat: Climate risk assessment in the insurance sector. Financial Stability Institute Insights on Policy Implementation, No. 20. https://www.bis.org/fsi/publ/insights20.pdf (Accessed: 28/08/2025)
22. Schanz, K.-U. (2023). The re/insurance perspective on disaster resilience. Environment Systems and Decisions, 43, 535–536.
23. Jarzabkowski, P., Chalkias, K., Clarke, D., Iyahen, E., Stadtmueller, D., & Zwick, A. (2019). Insurance for climate adaptation: Opportunities and limitations. Global Commission on Adaptation. https://www.gca.org/reports/insurance-for-climate-adaptation-opportunities-and-limitations/ (Accessed: 21/10/2025)
24. ClimateWise. (2021). Climate product innovation within the insurance sector. University of Cambridge Institute for Sustainability Leadership & Deloitte. https://www.cisl.cam.ac.uk/files/climatewise_climate_product_innovation.pdf (Accessed: 14/10/2025)
25. Mikaelsson, M. (2026). Insurance and reinsurance under climate stress: Managing systemic risk in global supply chains. Stockholm Environment Institute.
26. IAIS. (2025). Application paper on the supervision of climate-related risks in the insurance sector. International Association of Insurance Supervisors. https://www.iais.org/uploads/2025/04/Application-Paper-on-the-supervision-of-climate-related-risks-in-the-insurance-sector.pdf (Accessed: 24/09/2025)
27. Roper, J. A., Casagrande, D. G., & Bocchini, P. (2025). Climate change and insurance: Embracing resilience for private market survival. Sustainable Development, 33, 8499–8510.
28. Xu, Z., Fang, H., & Wang, W. (2025). The impact of climate risk on insurers' sustainable operational efficiency: Empirical evidence from China. Sustainability, 17(8), 3423.
29. Yang, Q., Lemanski, M. K., & Watters, C. (2025). The impact of climate change on the insurance industry: Perceptions of industry experts and corporate responses. Journal of Risk and Financial Management, 18(9), 516.
30. Corradin, S., Fontana, A., Kubitza, C., & Maddaloni, A. (2025). Insurance companies in the euro area: Asset allocation and impact on financial markets. ECB Discussion Paper Series, No. 28. https://www.ecb.europa.eu/pub/pdf/scpdps/ ecb.dp28~03966255e7.en.pdf (Accessed: 20/11/2025)
31. Kouwenberg, R. Strategic asset allocation for insurers under Solvency II. J Asset Manag 19, 447–459 (2018). https://doi.org/10.1057/s41260-018-0097-4
32. Mercer. (2011). Climate change scenarios: Implications for strategic asset allocation. Mercer, IFC, and Carbon Trust. https://documents1.worldbank.org/curated/en/138101493381025955/pdf/114650-IFC-Brief-Mercer-web-PUBLIC.pdf (Accessed: 18/10/2025)
33. Forum pour l'Investissement Responsable. (2020). Integrating ESG-climate issues into asset allocation: Challenges and practices. https://www.frenchsif.org/isr_esg/actus/2020/FIR-Asset-Allocation-Integrating-ESG–climate-ssues_October2020.pdf (Accessed: 13/11/2025)
34. Kaminker, C., & Stewart, F. (2012). The role of institutional investors in financing clean energy. OECD Working Papers on Finance, Insurance and Private Pensions, No. 23.
35. Ceres, Persefoni, & ERM. (2023). Changing climate for the insurance sector: Research and insights. https://www.sustainability.com/globalassets/sai-changing-climate-for-insurance_final.pdf (Accessed: 25/10/2025)
36. FSB. (2020). The implications of climate change for financial stability. Financial Stability Board. https://www.fsb.org/uploads/P231120.pdf (Accessed: 19/10/2025)
37. Ingels, M. W., Botzen, W. J. W., Aerts, J. C. J. H., Brusselaers, J., & Tesselaar, M. (2024). The state of the art and future of climate risk insurance modeling. Annals of the New York Academy of Sciences, 1541(1), 100–114. https://doi.org/10.1111/nyas.15255
38. Charpentier, A. (2008). Insurability of climate risks. Geneva Papers on Risk and Insurance – Issues and Practice, 33(1), 91–109.
39. He, Q., & Faure, M. (2022). Adaptation to climate change risks and regulation through insurance: The case of China. Climate Law, 12(2), 162–183.
40. Chen, B., Liang, Z., & Pang, S. (2025). Dynamic investment-driven insurance pricing and optimal regulation. Insurance: Mathematics and Economics, 125.