Climate risk is the insurance industry’s exposure to physical climate hazards and the economic transition away from carbon: repriced property lines, shifting catastrophe distributions, and mandatory climate disclosure. This section covers physical and transition risk assessment, climate-related disclosure frameworks, and how carriers are adapting underwriting and capital to a warming world.
California’s Office of Administrative Law approved CARB’s Initial Regulation on October 12, 2026. November 10 is now the hard first-year deadline for Scope 1 and Scope 2 reports from companies above $1 billion. Even with SB 261 enjoined, the emissions data that will start flowing has underwriting and claims implications for property, builders risk, and professional lines.
IFMA Pulse shows 45% of facilities managers adding ESG provisions to contracts. For carriers and brokers, that means more climate data, cyber requirements, and Scope 3 pressure flowing into underwriting.