More than 90% of general insurers and reinsurers expect climate change to affect their underwriting, according to an Australian Prudential Regulation Authority survey.

Risk to pricing certainty and policy exclusions are among areas where climate impacts will be felt, the regulator finds.

APRA says the survey shows “the connection between climate risk and … underwriting business is more apparent as weather events represent a material risk to insure against for home insurance”.

The self-assessment survey in April received 149 responses from APRA-regulated general, life and health insurers, plus banks and superannuation trustees.

Overall, the findings were broadly aligned with APRA’s expectations.

Most large entities have improved their “climate risk maturity” since the last survey in 2022. However, about one-quarter have seen their maturity score decline. 

APRA now intends to elevate climate risk within the regulatory and supervisory landscape.

“Stakeholder expectations are rising, and APRA is committed to ensuring that the institutions it regulates take a strategic and risk-based approach to managing climate-related risks in a proportionate manner,” member Suzanne Smith said.

Click here for the survey findings.