The European Insurance and Occupational Pensions Authority (EIOPA) published a report today examining how climate change could affect life and health insurers and occupational pension providers. The report identifies extreme heat as the leading climate-related liability risk for the sectors. While current financial impacts remain limited due to offsetting factors, widespread public-sector healthcare coverage and portfolio diversification, the risks are expected to increase in the coming decades.
Heatwaves are already the deadliest climate-related hazard in Europe. Since 2000, they have been responsible for around 300,000 deaths across the continent—about 97% of all fatalities linked to extreme weather and climate events. Scientists expect heatwaves to increase in frequency, intensity and duration over the coming decades, with heat-related deaths in extreme scenarios potentially reaching COVID-19-like levels.
Beyond heat-related mortality, more frequent wildfires and the potential spread of vector-borne diseases such as dengue and malaria could also affect population health. Together, these trends have direct implications for the mortality, morbidity (sickness-related) and longevity (life expectancy-related) assumptions that underpin the business models of life and health (re)insurers and pension providers.
To better understand these risks, EIOPA developed an illustrative risk-scoring framework to estimate the impact of heatwaves on different types of undertakings, lines of business and countries. The methodology is based on hazard, vulnerability and exposure metrics and largely aligns with EIOPA's methodology for measuring non-life insurers’ underwriting exposure to physical climate change risk.
The most impacted lines of business are projected to be medical expense insurance, income protection insurance and workers' compensation insurance in the non-life segment and similar-to-life health insurance and other non-participating life insurance in the life segment. However, impacts will be highly product- and portfolio-specific, as climate change may affect mortality, morbidity and longevity risks in a non-uniform way depending on the specific characteristics of the products. Heatwaves are likely to negatively affect the own funds of insurers through products exposed to mortality and health-related risks, while longevity adjustments may partially offset these effects.
Although the financial impact remains limited today, EIOPA encourages insurers to incorporate these emerging risks into their climate risk assessments holistically, reflecting both direct and broader indirect macroeconomic impacts, as their materiality is expected to increase over time.
EIOPA Chair Petra Hielkema said: "With the natural catastrophes of recent years, it has become apparent that our physical infrastructure is increasingly at risk from floods, storms and wildfires. But climate change also has quieter, less visible consequences—ones that show up more forcefully in statistics than in photographs. The impact of heatwaves on human health is one of them, and our preliminary study shows that it could become a material risk factor for certain insurance lines and pension providers, despite offsetting factors and strong diversification across products and risks."
- Publication date
- 30 September 2026