Equitable and sustainable business models

Climate change and nature loss are converging crises that intensify disaster risks and undermine ecosystem resilience. Nature-based solutions (NbS), including wetlands, urban tree cover, and coral reefs, are powerful tools that can address multiple societal challenges at once, such as ecosystem restoration and climate adaptation and mitigation. However, their implementation must be carefully designed to ensure both environmental sustainability and social equity. Insurance is increasingly recognised as a mechanism to support climate adaptation by redistributing risk, accelerating recovery, and incentivising resilience. When integrated with NbS, insurance schemes can deliver co-benefits for nature and communities. Yet, these schemes must be context-specific, financially viable, and socially just to avoid unintended consequences. This report explores how insurance models can be designed to incorporate equity and environmental sustainability. It explores how the concepts of risk reduction, social equity and nature can be embedded into the design of insurance schemes, unpacking and providing insights from existing frameworks. An assessment of case studies demonstrate diverse architectures of schemes and identifies five key insights: There are multiple possible configurations of insurance schemes: There are multiple ways to configure private, public and third sector actors. It is crucial to consider which configuration offers the best fit for purpose for any insurance scheme given local context and needs. There remains variation in levels of stakeholder engagement: How a scheme engages the stakeholders involved influences how it evolves and whom it serves. There is a need for consistent consideration of nature: Nature is often viewed secondary to climate, highlighting a need for nature to be consistently embedded into scheme design, including identifying and assessing co-benefits and trade-offs. Risk reduction is incorporated in schemes in different ways and to different extents: While risk-reduction is gaining prominence as a priority in insurance design, it needs to be fully integrated and its efficacy should be evidenced in order to ensure the long term sustainability and insurability of projects. Balancing the different principles of equity can be complex: Satisfying multiple aspects of equity can be a balancing act during design and implementation, and requires reflection on the scheme’s objective and scope. The case studies demonstrate that whilst insurance can be utilised as a financial mechanism to address the climate change and nature crises, as well as wider societal issues, its success depends on its structure and implementation. Ultimately, there is no universal blueprint for embedding equity and nature into insurance schemes. Success requires revisiting foundational assumptions, fostering cross-sector collaboration, and designing solutions that are principled, pragmatic, and adaptable. As climate and nature risks escalate, the need to develop robust, inclusive, and sustainable insurance models becomes ever more urgent.