Story perspectives

Europe Proposes Catastrophe Insurance Pool to Reduce Risk Gap

4/15/2026

Summary

Story summary

The European Insurance and Occupational Pensions Authority (EIOPA) and the European Stability Mechanism (ESM) proposed a natural catastrophe insurance pool.
The pool would expand coverage for severe disasters and could cut the insurance protection gap to 10%.
A loan-based backstop would support events beyond the pool’s capacity, up to EUR 65 billion.
The proposal would use insurance-linked securities (ILS) and would highlight capital markets’ role in managing climate-related catastrophe risk.

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Story summary

The European Insurance and Occupational Pensions Authority (EIOPA) and the European Stability Mechanism (ESM) proposed a natural catastrophe insurance pool.
The pool would expand coverage for severe disasters and could cut the insurance protection gap to 10%.
A loan-based backstop would support events beyond the pool’s capacity, up to EUR 65 billion.
The proposal would use insurance-linked securities (ILS) and would highlight capital markets’ role in managing climate-related catastrophe risk.