EU to Create Climate Insurance Alliance as Extreme Weather Losses Mount

The European Union will establish a "climate insurance alliance" to widen insurance coverage for extreme weather events, European Commission President Ursula von der Leyen said in an address to the European Parliament.

Von der Leyen said the gap in protection is stark: only about a quarter of catastrophe losses across Europe are currently covered by private insurers. As a result, national budgets frequently end up acting as the insurer of last resort, she said.

"We need to take action to close this gap," she told lawmakers, framing the shortfall as a problem that demands a collective response.

The announcement follows a summer marked by extreme weather across the continent, which has intensified pressure on governments to find ways to spread the financial risk of disasters.

The proposed alliance is intended to draw more of those losses into the private insurance market, reducing the strain on public finances when catastrophes strike. No further details on the scheme's structure, membership or timeline were immediately provided.