Our approach is about rigorous structuring and diligence to truly de-risk emerging market investments – getting the first projects right so we can replicate and grow the asset class. Jamie Fergusson, Global Director, Climate and Nature, International Finance Corporation The role of the insurance industry is important for climate investments in emerging markets, but it is not talked about often enough. Linda Freiner, Group Chief Sustainability Officer, Zurich Insurance Group If an asset or operation is uninsurable, it’s likely uninvestable. Insurance today goes beyond protection. It serves as a barometer of climate readiness and long-term asset value. The role of the insurance sector in a changing climate is not merely a technical or market issue; it is a systemic, political challenge that demands collective action. Laurence Tubiana, Chief Executive Officer, European Climate FoundationReimagining the role of insurance There is a direct link between insurability and bankability: if a project cannot be insured, it is unlikely to attract private investment. Insurance plays a vital role in unlocking private climate finance in EMDEs by absorbing and transferring climate-related and policy risks that often deter investors. Insurance mechanisms such as political risk insurance and pooled facilities can materially improve the bankability of climate projects in EMDEs by stabilizing returns and lowering financing costs. However, despite its importance, climate insurance remains underdeveloped and underutilized in many EMDEs. Private insurance markets tend to be shallow, especially in sub-investment-grade countries and there is limited awareness of existing risk mitigation tools provided by entities such as MIGA and other multilateral organizations, which limits their overall impact. In practice, securing political risk and export credit cover can take months of negotiation and involve complex legal documentation, which is a barrier especially for smaller investors. This could explain why most survey respondents ranked de-risking products offered by export credit agencies as among the least effective solutions for private capital mobilization. The technical know-how and solutions for climate insurance already exist. The real challenges lie in scaling-up these solutions and securing political alignment. For insurance to fulfil its potential, it must shift from being a reactive safety net to a proactive signal of resilience and financial viability. This requires innovation, adopting new technologies and creating tailored insurance products suited to specific sectors, regions and project types. From Risk to Reward: Unlocking Private Capital for Climate and Growth 33

Risk to Reward 2025