Meeting the global need for new and improved infrastructure will require roughly $106 trillion in investment by 2040. Ensuring this infrastructure is sustainable and resilient is of paramount importance for long-term economic growth - especially in Emerging Markets and Developing Economies (EMDEs), which are projected to contribute roughly 98% of global population growth over the next two decades.
Yet multiple risk factors limit investor appetite for financing infrastructure projects in EMDEs: political instability, weak regulatory frameworks, limited public sector budgets, and capacity constraints, to name just a few. And globally, economic losses from natural catastrophe and extreme weather events surpassed $300 billion annually for the past nine out of 10 years.
Against this backdrop, investors are increasingly asking how infrastructure projects can remain insurable over their full lifecycles, recognizing that a lack of insurability can directly undermine bankability.
At the Global Infrastructure Facility (GIF) – a G20 initiative delivering bankable pipelines of sustainable infrastructure projects – we see firsthand that if resilience factors are not incorporated early in project preparation, assets often become uninsurable later in life.
Partnering for Resilience in Infrastructure Finance
In light of these challenges, the GIF worked with Aon, the International Finance Corporation (IFC), and the Multilateral Investment Guarantee Agency (MIGA) to produce a new white paper titled “Underwriting the Future of Resilience: Developing Insurable and Bankable Infrastructure,” available for download here.
The white paper focuses on social infrastructure assets such as hospitals, schools, government buildings, and examines how insurers assess physical climate risks when underwriting new infrastructure projects, which resilience measures matter most for underwriting, and sets out practical ways for aligning project preparation practices with underwriting expectations to drive infrastructure performance, economic value and stability.
The white paper – and the Aon-led survey of 25 global insurance and reinsurance companies that informed it, highlight the following key themes:
Climate risk assessment has become essential to underwriting. More than 80% of insurers surveyed say climate risk assessments are now essential or very important when evaluating infrastructure projects. In other words, yesterday's sustainability concerns are becoming fundamental to tomorrow's underwriting considerations.
Take action: Clearly articulate to insurance brokers and carriers how both natural catastrophe and forward‑looking climate data are used for infrastructure development and risk management decisions.
Insurers are often brought into projects too late. Most insurers get involved as construction is about to break ground. By that stage, the most important resilience decisions – where infrastructure is located, how it is designed and engineered to mitigate climate risk – have already been made and the most consequential choices for resilience have been locked in.
Take action: Early, structured engagement between governments, developers, engineers, financiers and insurers should become the norm to allow climate risk considerations to shape project design rather than react to it.
When asset owners and developers provide limited information about climate risks or resilience measures, insurers have to make more cautious assumptions. The result is more conservative underwriting, leading to higher premiums and coverage restrictions.
Take action: Apply an Assess → Map → Embed (AME) approach, introduced in the white paper, to help shift this dynamic by standardizing how current and future physical climate risks are assessed, mapped to exposure, and then embedded into siting, design, construction and operations.
There is a gap between sustainability narratives and the information driving underwriter decisions at a practical level. Green certifications and sustainability labels (e.g., LEED, BRI, FAST-INFRA Label, EDGE and BREAAM) have proliferated in infrastructure development, yet insurers rarely rely on them when evaluating risk. This is because an asset can be certified "green" and still be highly vulnerable to climate hazards.
Take action: Link sustainability certifications to risk reduction to add quantifiable value to these standards and give underwriters more data to work with.
Optimal risk management and risk transfer outcomes are often missed, even as new resilience offerings and product innovation is accelerating. Often, insurance is not considered until late in the process and treated as a mere checklist item near financial close.
Take action: Consider insurance strategy during feasibility and early design to help optimize the cost of risk management program overall, striking the right balance between engineered and financial risk transfer solutions.
From Insights to Action: the GIF as a “Whole of Society” Convener
Taken together, these insights point to a broader shift in how infrastructure risk is being evaluated. The white paper also highlights that projects adopting a “whole-of-society” approach to risk management are more likely to succeed. Governments set building regulations, zoning by laws, building codes and launch tenders. Developers structure and finance them. Contractors build them. Operators manage them. Investors buy and sell stakes over time. In this sense, climate risk can resemble a game of musical chairs: each actor participates for a period, but the long‑term risks remain embedded in the asset itself.
Precisely because those long‑term risks stay with the asset, the real moment of influence, therefore, comes during project preparation. This is precisely why the role of the GIF is critical. By convening diverse stakeholders to harness a “whole of society” approach at scale, the GIF aims to ensure infrastructure projects are not only bankable, but resilient and durable over the decades they are meant to serve.
Read and download the report here.
Mariana Silva Zuniga is a Senior Infrastructure Finance Specialist at the Global Infrastructure Facility.
At Aon, Natalia Moudrak serves as Managing Director, Climate Risk Advisory, and Irina Waltz, serves as Director, Strategy and Technology Group.
At the World Bank, Margarita Cabrera Botero is the Head of Climate Business at the Multilateral Investment Guarantee Agency, and Ommid Saberi is a Principle Industry Specialist and the International Finance Corporation.
