Green insurance products are gaining traction in the global market as both consumer demand for sustainable options and climate-related risks intensify, according to new research from data and analytics company GlobalData.
A Q3 2025 poll conducted on Verdict Media sites found that 41.9% of insurance industry professionals consider it “very important” for insurers to offer environmentally friendly products, with a further 16.2% viewing it as “moderately important.”
By contrast, 30.5% of respondents deemed green products non-essential – a stance GlobalData warns could leave them lagging behind in
product innovation.
“The challenges posed by climate change have led to the emergence of green or sustainable insurance, encompassing products and practices that integrate ESG factors into the value chain,” said Beatriz Benito, lead insurance analyst at GlobalData. “Equally, consumer awareness about environmental issues has increased, with many now expecting to see eco-friendly options, including insurance.”
GlobalData’s 2024 Emerging Trends Insurance Consumer Survey underscores this trend. More than half of the respondents (51.3%) believe insurance companies have a role in tackling climate change, compared with 28.1% who disagreed and 20.6% who were unsure. The survey also revealed that 59.1% of consumers would be willing to pay more for policies from companies with strong ethical and environmental commitments. Nearly 30% said they would pay up to 5% more.
Benito noted that green insurance offerings are not solely about meeting consumer preferences, but also about risk management. “Climate change is leading to more frequent weather events and natural disasters such as wildfires, floods, and tsunamis, which are resulting in higher claims,” she said. “Insurers can offer green products in a bid to mitigate climate-related risks.”
Practical measures could include discounts for energy-efficient homes and vehicles, as well as coverage incentives for using sustainable building materials. Such initiatives, GlobalData suggests, can help insurers manage potential losses while supporting environmental goals.
Regulatory pressures are also shaping the shift. “Governments and regulatory bodies are increasingly implementing regulations that require businesses – including insurers – to adopt ESG practices, as well as making disclosures,” Benito added. She said insurers demonstrating environmental commitments could strengthen brand reputation, boost consumer trust, and position themselves as forward-thinking, responsible organisations, potentially allowing them to command higher prices for their products.
GlobalData’s Q3 2025 poll on Verdict Media sites drew over 100 industry responses, while its Emerging Trends survey gathered 5,520 consumers from 11 countries, with at least 500 per nation.
Article courtesy of insurancebusinessmag.com
