Reserving for climate change is one of the most pressing challenges facing insurers today, yet defining a clear approach remains difficult. Climate change affects every line of business differently — catastrophic exposures such as wildfires and floods demand immediate attention, while more gradual shifts in claims patterns, economic impacts and climate change litigation present their own complexities. A one-size-fits-all solution is unrealistic. Instead, insurers need a structured, granular approach that considers risk by line of business, geography, and industry. Without such an approach, firms can find themselves with fragmented and inconsistent approaches implemented across the business; exposed to stakeholder challenge when there is a lack of alignment between the strategic and operational posture adopted.
At Marcuson Consulting, we are leading the way in developing practical, actuarial solutions for reserving for climate change. With an active role in developing and shaping professional and industry practice, we help insurers adopt a proportionate and pragmatic approach to this complex challenge.
Why Climate Change Reserving Matters
• Regulatory Expectations Are Evolving – While the PRA and other regulators have begun addressing climate risk, there is no established framework for reserving for climate change. Insurers who act now will be better positioned for future regulatory scrutiny.
• Beyond Catastrophes – The Hidden Impact on Claims – Climate change is reshaping insurance portfolios in ways beyond the obvious. Changing weather patterns, regulatory pressures, and economic shifts are influencing loss ratios across multiple lines of business. Insurers need to consider these gradual but compounding effects alongside more immediate risks.
• Staying Ahead of the Curve – Insurers taking proactive steps towards reserving for climate change are building resilience, enhancing decision-making, and gaining competitive advantage as the market evolves.
Marcuson Consulting: An Authoritative Voice on Reserving for Climate Change
• Industry-Leading Expertise – Alex Marcuson is widely recognised as a leading voice on reserving for climate change. As the co-leader of the GIRO prize-winning Climate Change Working Party, he has helped shape actuarial thinking in the UK and globally in this critical area.
• Shaping the Conversation – Our approach to climate change reserving is informed by close consideration of the priorities of regulators, Lloyd’s market participants, and general insurers. By drawing on these key perspectives, we’re refining practical solutions to address evolving challenges, including the impact of climate change litigation.
• Developing the Gold Standard – At Marcuson Consulting, we’re helping shape the future of climate change reserving by developing tailored, actuarially sound solutions. Our pragmatic consulting style and focus on clear, board-level communication ensure these frameworks translate complex climate risks into actionable insights for decision-makers.
Further Reading
Explore our latest thinking on reserving for climate change and its intersection with climate change litigation:
•[CCWP paper] (Link to Resources page – in progress)
•[Other relevant papers] (Link to Resources page – in progress)
Navigate Climate Change Reserving with Confidence
Marcuson Consulting is dedicated to helping insurers navigate the challenges of climate change reserving with practical, forward-thinking solutions. From meeting regulatory expectations to assessing portfolio exposures and preparing for the impacts of climate change litigation, we aim to offer the insights and support you need to respond effectively.
Get in touch today to start a conversation about how we can help you.