Waterproofed hut foundations reducing flood risk, Katakwi, Uganda. Source: James Acidri, Evidence for Development and Pearl Associate, NIMFRU project.
We are pleased to share a new joint policy note, Insurance will not close the climate adaptation gap: Here is where it can help, co-authored by Akhand Tiwari and Graham Wright of MicroSave Consulting (MSC), and Professor Rosalind Cornforth and Dr Celia Petty of The Pearl.
The note examines the role insurance can play in financing climate adaptation for underserved households, MSMEs, smallholder farmers, and agricultural value-chain actors, groups who together represent one of the largest and least served segments of the global adaptation finance gap. Drawing on UNEP’s Adaptation Gap Report 2025, the note sets out why insurance alone cannot close that gap, but argues it has a bounded, valuable role to play within a wider financing architecture, one that also depends on credit, guarantees, and adaptive social protection working together.
The policy note grew out of a climate insurance roundtable co-led by MSC and The Pearl, and hosted by the National Institute of Economic and Social Research (NIESR), during London Climate Action Week 2026. It draws on evidence from Pakistan, Uganda, Malawi, and The Pearl’s own fieldwork in Akkar, northern Lebanon, and proposes a six-question investability test for identifying which adaptation investments are genuinely ready for insurance-backed finance, alongside seven design shifts for building a more effective insurance architecture over the next three to five years.
This work reflects The Pearl’s wider commitment to connecting climate science with the financial and policy decisions that determine whether adaptation investment actually reaches the people who need it most, particularly in fragile and climate-exposed settings where conventional financial products are becoming harder to access as climate risk rises. We look forward to continuing this partnership with MSC as the ideas in this note are tested and taken forward.
Further information
Download the full policy note (PDF) directly
Read the full policy note: https://doi.org/10.5281/zenodo.22086334
Learn more about MicroSave Consulting: microsave.net
Link here to the National Institute of Economic and Social Research (NIESR): https://niesr.ac.uk