"To act effectively, companies need visibility. However, historical data are no longer sufficient to anticipate future crises, pushing companies to rely on new, more forward-looking scientific approaches," explains Julien Boucher, co-founder of Earth Action.
For a long time, natural disasters were seen as exceptional events: isolated crises covered by insurance and, as a last resort, by public finances. But this model is changing. The multiplication and intensification of climatic events are putting increasing pressure on the insurance system. In some regions, premiums are rising sharply; in others, certain coverages are disappearing.
The recent WWF report on the “insurance protection gap” clearly quantifies this trend. It sends a clear signal: when certain risks become difficult to insure, they do not disappear; they shift onto businesses, value chains and public finances.
Each year, 59 billion euros of uninsured damages are recorded in the European Union, and 64 billion dollars in the United States. These amounts represent only the tip of the iceberg: the part of direct losses already not covered by insurance. By including indirect impacts and the degradation of ecosystems, often impossible to insure, the total global cost of climate disasters could reach $2.3 trillion per year.
Europe clearly illustrates this trend. Between 1980 and 2024, only 20% of economic losses related to climatic events there were covered by insurance; the remaining 80% were absorbed by the real economy. Switzerland itself provides a revealing example: the protective forests of the Alps reduce natural risks each year by an estimated value of 4 billion francs.
Without this natural infrastructure, the technical measures necessary to provide the same level of protection would cost twenty-five times more. Resilience therefore has a price, and nature sometimes provides protection that we have long taken for granted.
A local disruption can today produce global economic effects.
The WWF report also recalls a reality often underestimated: climate risk does not remain confined to the place where it occurs, but spreads through value chains. A local disruption can today produce global economic effects. A concrete example is the floods in Valais, where the production halt at aluminium supplier Novelis led to between one and two billion euros in losses for car manufacturer Porsche, despite being located several hundred kilometres away.
This dynamic concerns many industries. Pharmaceutical production, for example, depends heavily on critical natural resources, notably water and certain biological materials. In several regions of the world, water stress or water pollution have already forced industrial sites to slow down or suspend their production.
In a world of globalized supply chains, the vulnerability of one supplier can quickly become that of an entire industry. The degradation of ecosystems further amplifies this phenomenon. In some areas of massive deforestation, the risk of flooding can be multiplied by seven. The health of local ecosystems thus becomes a direct factor of economic stability.
The gradual withdrawal of insurance serves as a wake-up call. Climate risk is no longer only an environmental issue: it becomes a matter of business continuity, access to capital and industrial competitiveness. Companies will now have to integrate these risks into their investment, location and supply chain management decisions. In this context, prevention and adaptation also fall under an economic logic.
According to the analyses cited in the WWF report, each dollar invested in resilience can avoid up to thirteen dollars of future damage.
According to the analyses cited in the WWF report, each dollar invested in resilience can avoid up to thirteen dollars of future damage. In other words, anticipating risks is no longer merely an act of responsibility: it is also a risk management strategy. True competitiveness tomorrow will lie in the ability to absorb shocks that insurers no longer cover.
But to act effectively, companies need visibility. Historical data is no longer sufficient to anticipate future climate crises. Companies must now rely on forward-looking scientific approaches capable of identifying points of vulnerability in their value chains.
Science is not meant to arouse fear, but to trace the only viable trajectory for the real economy. It is precisely in this area that certain organizations are working to transform scientific data into decision-support tools, in order to identify where risk is concentrated and where action is most effective.
By relying on methods such as life cycle analysis or carbon accounting, it becomes possible to map environmental dependencies throughout a value chain and to identify the most critical points of vulnerability. This approach allows companies to prioritize their actions where they will have the most impact: securing a sensitive supply, reducing exposure to a climate risk or anticipating a break in the production chain. In a context where some risks are becoming less and less insurable, this capacity to anticipate constitutes a strategic advantage.
Climate disasters continue to increase, value chains remain exposed and insurers are already adjusting their models.
The climate debate in Switzerland illustrates the sensitivity of the issue well, long presented as a trade-off between growth and environmental protection. The recent rejection of the initiative for a climate fund by more than 70% of voters shows that a large part of the population remains cautious about solutions that rely primarily on new public financing.
This democratic signal must be heard. But it does not change the economic reality of the risk. Climate disasters continue to increase, value chains remain exposed and insurers are already adjusting their models. In other words, the cost of risk exists, regardless of the outcome of the vote.
The real question is therefore not whether this cost will exist, but how it will be anticipated, distributed and managed. For companies as for public authorities, the challenge is now to integrate these risks earlier into economic decisions: investment, infrastructure, supply chains and territorial planning.
In this context, science and analytical tools become essential to illuminate choices. When certain risks become less insurable, they inevitably become more visible in the real economy. Better understanding them today therefore makes it possible to better control them tomorrow. When risk becomes less insurable, it necessarily becomes more strategic.
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