This year, EIOPA updated its strategy, building on strong foundations and with growing prominence given to sustainability.

At EIOPA, we have always underlined the vital role that insurance companies and pension funds can play in the green transition. They are major institutional investors, able to invest the sizable funds they have at their disposal to create long-term value for society. Moreover, through active stewardship, insurers can substantially support firms in reducing their greenhouse gas emissions. Insurers and reinsurers also act as risk managers for society and can play a valuable role in reducing climate change risk, in addition to raising policyholder awareness of climate-related risk exposures.

The affordability and availability of protection is a key consideration, as is closing protection gaps.

In this regard, EIOPA has recently conducted an analysis of insurers’ exposure to physical climate change risk, based on a large-scale exercise in which industry data was collected. We have also been looking at climate change adaptation in non-life underwriting and pricing. Here we have collected good underwriting practices to better understand how insurers integrate climate-related adaptation measures in non-life insurance products and to promote the further development of climate-resilient products by the insurance industry through sharing good underwriting practices. Furthermore, we have been carrying out behavioural research to better understand why people do not buy the insurance products that are available, as well as looking into consumers' experience with their insurance following natural catastrophe events. For this second study, we included consumers who were affected by last year's flooding in Germany.

Our natural catastrophe dashboard will help to identify the drivers of the climate-related insurance gap in Europe. This in turn will help to identify measures to reduce losses resulting from natural catastrophes and therefore help consumers and businesses insure against those risks.

Given the impact that risks related to climate change will have on the insurance industry, it is important to encourage a forward-looking approach to the management of these risks. We have therefore provided the industry with application guidance on climate change materiality assessments and climate change scenarios in the Own Risk and Solvency Assessment (ORSA). This guidance can help lower implementation costs for insurance undertakings, in particular small and mid-sized undertakings, taking into account the size, nature and complexity of climate change risk exposures.

Engaging consumers and retail investors is also vital if their funds are to be channelled into green investments. Both the EU Taxonomy and the Sustainable Finance Disclosures Regulation are intended to help with this and also to protect against greenwashing.

Climate change and broader sustainability issues can no longer be ignored and through its work, EIOPA aims to ensure the sustainability of Europe’s insurance and pensions sectors.