Ferma calls for EC climate protection gap body

Ferma has repeated its call for a permanent body to advise Europe’s policymakers on climate adaptation and resilience following the publication of a major EU study from the Climate Resilience Dialogue, convened by the European Commission (EC), earlier this week on narrowing the climate protection gap.

The European risk and insurance management federation said an Expert Group on Climate Protection Gaps should be established to advise the EC on policy ahead of the next EU Adaptation Strategy. “Ferma believes the European Commission must bring together a wide range of stakeholders representing expertise across the spectrum of initiatives outlined in the report to be part of the Expert Group with a clear mandate from the Commission,” it said.

Typhaine Beaupérin, CEO of Ferma, said risk management would add key expertise to help forward the EC’s work on climate change and adaptation in several areas.

“The risk management function is critical to helping manage the physical risks resulting from climate change, including the increased frequency and severity of natural hazards. At the enterprise level, risk managers also play an integral role in enabling the strategic assessment of those risks and the opportunities in their operations across the value chain that can bolster not only resilience but competitiveness in this new era of risk,” Beaupérin explained.

The Climate Resilience Dialogue Report recognises the role of risk management and the risk manager function as central to achieving the required levels of climate resilience across Europe.

“At enterprise level, a dedicated function of risk manager can help to permeate a risk management culture throughout – generally large – organisations”, the report says, adding a call for “the creation of market incentives to invest in risk management solutions”.

Further, the report says insurance is key to closing the climate protection gap, with only 25% of climate change-related losses covered by insurance in Europe, and managing climate risk. It proposes the introduction of bundled insurance across multiple climate perils to “facilitate a broader spread of risk across hazards and geographic regions” and also looks at the potential for reinsurance pools or public-private partnerships to “ensure that the risks, costs and responsibilities are clearly shared”.

The Climate Resilience Dialogue Report was published following an 18-month project with 17 stakeholders, including the UN Office for Disaster Risk reduction and insurance body Eiopa, with Ferma and Insurance Europe acting as co-rapporteurs.

Beaupérin said Ferma welcomed the opportunity to partake in the initiative. “The Climate Resilience Dialogue provides a strong foundation upon which to increase awareness of climate risk and boost levels of resilience and preparedness across Europe,” she said, although Beaupérin stressed that an expert group was needed to build on the foundations, “particularly given the speed at which impacts from climate change are being felt across Europe”.

Beaupérin added: “It is imperative that we recognise the clear call to action that [the report] provides, both at company and European level, and take the challenging but necessary steps required to narrow the climate protection gap and ensure that we maintain the momentum that this report has created.”

Ferma’s drive for an expert group is in line with its 2024-2029 policy manifesto launched in June 2024, which called for the EC to establish an expert group on climate protection gaps as well as create a permanent risk management function and address the lack of insurance solutions for the net-zero transition.