Insurance is on the front lines of climate risk, and may help shape how we respond to it.

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Insurance is one of the quiet pillars of the modern economy. It underpins where we build, how we invest, and whether communities can recover after disaster. In many ways, it defines what risks we’re willing, and able, to live with.

But that foundation is under strain. Across the United States, rising losses from wildfires, floods, and other extreme events are driving up insurance costs and pushing insurers out of some markets. In states like California and Florida, homeowners are finding it harder, and more expensive, to secure coverage. When insurance becomes unavailable, the consequences extend beyond individual households, affecting housing markets, local economies, and community stability.

Carolyn Kousky, founder of Insurance for Good and a senior fellow at the Kleinman Center for Energy Policy, explores how climate change is reshaping insurance markets and what that means for the future of risk, investment, and resilience. She explains how insurance doesn’t just respond to risk, but can also influence it by shaping investment in resilient infrastructure, guiding development decisions, and affecting the flow of capital into cleaner energy systems.

Carolyn Kousky if a senior fellow with the Kleinman Center for Energy Policy and founder of Insurance for Good.

Related Content:

Measuring What Matters: Rethinking Energy Insecurity Metrics https://kleinmanenergy.upenn.edu/research/publications/measuring-what-matters-rethinking-energy-insecurity-metrics/

Policy Design Issues for Border Carbon Adjustments https://kleinmanenergy.upenn.edu/research/publications/policy-design-issues-for-border-carbon-adjustments/

Energy Policy Now is produced by The Kleinman Center for Energy Policy at the University of Pennsylvania. For all things energy policy, visit kleinmanenergy.upenn.edu.