Munich: The European Commission will set up a Climate Insurance Alliance to close the gap between disaster losses and the cover Europeans can buy, President Ursula von der Leyen announced on 16 September 2026. Only about 25% of catastrophe losses in the EU are covered by private insurance, which leaves roughly three quarters falling on households, businesses and public budgets.

“This is why the Commission will set up a Climate Insurance Alliance,” von der Leyen said in her State of the Union address. The Climate Insurance Alliance will bring together insurers, experts, investors and regulators to expand coverage and promote risk prevention. Von der Leyen linked the move to a summer in which wildfires burned about 660,000 hectares and crop losses reached 12 million tonnes.

The alliance forms one part of a wider resilience package. The Commission will present a climate resilience framework on 28 October 2026 that identifies Europe’s 100 most vulnerable territories and assesses which risks need management at local, national and European level. The European Parliament’s research service has already published a briefing on the framework.

The package also lists a European heatwave plan with early warning and health preparedness, and a European water initiative on risk management for farms and industry. The Commission describes all three measures in its State of the Union initiatives. Together they shift the emphasis from repairing damage towards preventing it.

Insurance sits at the centre of that shift because the numbers are stark. A household without cover for flood, fire or storm damage carries the full cost of a disaster, and governments often step in afterwards with emergency funds. A working Climate Insurance Alliance could lower premiums for lower-risk properties, reward investment in prevention and pull more private capital into resilience.

Experts have already questioned how far a forum can go. Green Central Banking reported criticism that the Climate Insurance Alliance alone would not close the gap without stronger public-private schemes and requirements to cover natural hazards. The report named Petra Hielkema, chair of the European Insurance and Occupational Pensions Authority, among the key stakeholders.

The design choices will matter. Some member states already run national disaster schemes, while others leave cover almost entirely to the market, so the alliance must work across very different systems. Regulators will also want to know how any data sharing on risk would affect pricing, and whether higher-risk regions could become uninsurable.

The 28 October framework will give the first clear test of the Commission’s ambition. If it pairs the 100-territory risk map with funding rules, the Climate Insurance Alliance could become the link between risk data and affordable cover. If not, it risks becoming another discussion table.

For homeowners and farmers, the practical question is simple: will the Climate Insurance Alliance make cover cheaper and easier to obtain? The Commission has not yet said when the alliance will start work or who will chair it. Those details, and the 28 October framework, will show whether the pledge turns into real protection.