Insurance and risk transfer

A widening insurance protection gap is exposing households, businesses and governments to escalating financial risks. WWF calls for nature to be placed at the heart of resilience and risk-reduction strategies.

The proposal comes in light of rising property insurance premiums and policy cancellations or nonrenewals across the country and much of the West.

(Re)insurance injects billions of dollars of non-recourse funding, in a structured way, to help facilitate a reformative recovery from events like the 2025 Palisades and Eaton fires. Non-recourse is important to highlight.

Natural hazards caused significant losses worldwide in 2025. All in all, damage amounting to US$ 224bn was incurred, of which insurers covered around US$ 108bn. This means that 2025 joins a list of years with insured losses exceeding the US$ 100bn mark.

Many Australians think disaster-hit regions are all, more or less, the same if they suffer the same size of area burned or other immediate measures of fire loss. But when viewed through a more comprehensive lens, a different story emerges.

The benefits of parametric insurance include its efficiency and transparency, but governance is key, and administrative transitions can cause delays that carve away at benefits.

When Hurricane Delta hit Mexico’s Caribbean coast in 2020, insurance payouts were released within days – not to rebuild hotels or roads, but to repair coral reefs.

Wildfires dominate headlines for their high price tags, but behind the insured losses are even greater invisible costs: the lasting social, health, ecological, and economic costs that shape recovery long after the flames die down and the smoke clears.