The insurance industry has been urged to play a leading role in capturing data to show how the costs of transitioning to a low-carbon economy will evolve.

Australian Prudential Regulation Authority Executive Board Member Geoff Summerhayes says such data remains badly underdeveloped, making informed debate challenging.

“The tools and methodologies for conducting climate risk analysis have a long way to go,” he told the International Insurance Society’s Global Insurance Forum in Singapore.

“The quality and availability of the data are limited, and further work is needed to translate the science into useful decision-making information.”

Only 800 companies with a combined market capitalisation of about $10 trillion support the Task Force on Climate-related Financial Disclosures – a fraction of all companies worldwide; global GDP is an estimated $88 trillion.

“The level of economic structural change needed to prepare for the transition to the low-carbon economy cannot be undertaken without a cost,” Mr Summerhayes says.

“But it’s also true that failing to act carries its own price tag due to such factors as extreme weather, more frequent droughts and higher sea levels.”