The majority of insurance professionals are expecting an increase in the frequency and severity of major climate events this year, according to The Digital Insurance Predictions 2026 survey.
Twenty-four percent of carrier respondents said natural disasters present the biggest challenge to growth and 55% predict disaster insurance will see moderate or high growth, according to the results.
"I feel that major insurance carriers will begin treating climate change not as a risk to model but as a direct uninsurable threat to property ownership," said a respondent.
The survey was fielded online during October - December, 2025 among 100 insurance industry professionals. Respondents represent a range of organization types, with the largest shares from agencies/brokerages (33%), P&C carriers (18%), multi-line carriers (15%), health insurance carriers (12%), and life insurance carriers (7%).
"I think we all see the same thing coming. Higher insurance rates due to climate change and the increasing catastrophic events," said a respondent in the survey.
Insurance professionals expect the federal government to continue to step back disaster recovery and reduce or dismantle FEMA. Over half of respondents predict states will take over more responsibility for disaster relief and 43% predict states will address climate risks for critical infrastructure.
"I feel that the major insurance players will be getting out of areas that are high risk to large natural disasters," said a respondent.
Respondents noted one of the top issues this year is a lack of affordable options for disaster insurance.
"Climate risk modeling is emerging as a critical add-on to traditional CAT models. As severe weather becomes more frequent and disastrous, insurers need tools that look beyond historical data. While CAT models are important for assessing near-term losses, their historical data approach can't fully capture how climate change is affecting future risk patterns."
