Positive early steps made by EU insurers in addressing biodiversity risk

Written by Adam Cadle

30/06/2025

Positive early steps by European insurers in addressing biodiversity risk have been made, according to EIOPA, but calls remain for stronger collaboration in key areas.

EIOPA’s latest report on biodiversity risk has revealed that one in every five insurance undertaking mentions biodiversity in their Own Risk and Solvency Assessment (ORSA), although current assessments remain largely qualitative.

Undertakings recognise biodiversity loss as a significant emerging risk but face challenges in quantifying its financial impact. Insurers are therefore still in the early stages of identifying, measuring and managing biodiversity loss, and primarily consider it from a reputational point of view, the report stated.

It added: “The lack of global metrics, the regional specificities of biodiversity, and the difficulty of distinguishing biodiversity risks from climate change risks pose challenges to making actionable risk assessments today.”

EIOPA will further engage with stakeholders to identify areas of action that should be prioritised, covering data availability issues, the development of models and scenarios and risk-based measures to manage biodiversity risk.

Furthermore, it said it will further engage with stakeholders to better understand the interplay of biodiversity and climate risks including the potential benefits of (nature-based) adaptation measures for addressing natural catastrophe insurance gaps.

It aims to also build capacity through a structured dialogue between supervisors and industry representatives.

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