The study pointed out that the widening protection gap -- the difference between total climate-related losses and what insurers cover -- is undermining cities' ability to recover from disasters. As climate shocks increase in frequency and intensity, insurers are becoming more selective about the risks they underwrite, while pricing reflects both the physical and transition risks facing cities.

In the US, Broward County, Florida, saw flood insurance premiums surge by more than 400%, prompting local officials to demonstrate that flood defense investments could deliver measurable economic returns. By proving the cost-effectiveness of prevention, the county attracted business support and began securing alternative funding mechanisms. According to the report, this example shows how risk modeling and insurance data can guide capital allocation and reduce long-term exposure.