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Aon published an article in partnership with The Economist about how the firm is leveraging data and insights to help organizations mitigate their exposure to climate risk and spur innovation.

Why it matters: The climate crisis is at our doorstep and presents volatility that can no longer be viewed as a distant threat. Aon leverages data to empower organizations with the insights to help mitigate their exposure to the risk climate change poses.

By the numbers: Only 38 percent of weather – and climate – related economic losses in 2021 were covered by insurance. 2021 was the third costliest year on record after adjusting for inflation. In 2022, while the majority of losses were left uninsured, the 58 percent “protection gap” was one of the lowest on record, highlighting a positive shift in how businesses are navigating volatility through risk mitigation and how insurers are providing further protection to underserved communities through access to capital. According to Eric Andersen, Aon president, this shows there is both a protection and innovation gap when it comes to climate risk:

• “Climate change is inherently tied to other, more tangible risks, where the immediate impact is measurable – such as business interruption, material scarcity, damage to reputation, regulatory- changes and supply issues,” said Andersen. Aon’s 2022 Executive Risk Survey shows confident leaders have an increased appetite to address interconnected risks. Learn more in Reinsurance News.

For further insight: Read the first article in the series from Aon and The Economist, “Finding Value Amidst the Volatility” and hear from Aon CEO Greg Case about how Aon can help organizations prepare for and mitigate both current and future risks.