The role of insurance in the low-carbon transition

As global efforts toward a low-carbon economy accelerate, insurers face both new risks and new responsibilities. This presentation explores the critical role insurers—and pricing actuaries in particular—must play in managing climate-related transition risks. While financial institutions are increasingly supporting green investments and low-emission initiatives, insurance companies are uniquely positioned to underwrite risks associated with the shift to a sustainable future. From technology performance guarantees to carbon credit protection and nature-based solutions, innovative insurance products can directly support businesses in their transition. Pricing actuaries are not only responsible for setting adequate premiums but also for designing risk-sharing structures, considering reinsurance, and leveraging capital markets through tools like Insurance-Linked Securities (ILS). By transforming transition risks into insurable events and distributing them through capital markets, insurers help align economic incentives with climate goals. This makes the burden of transition a shared societal task—accessible and manageable for all. The actuary’s role thus expands beyond technical pricing to shaping sustainable solutions that contribute to both business viability and public good.