Insurance capacity needs to be 10 times larger than it is today to accommodate the amount of investment that will be put into alternative energy and other forms of climate change technology, says a leading climate change insurance expert.

Liz Henderson, the executive managing director of Aon’s Climate Risk Advisory and Catastrophe Analytics unit, says innovation in insurance products is vital to meeting the world’s investment needs.

In a video interview with Bermuda:Re+ILS at the Bermuda Risk Summit, she says: “Innovation on the product side is vital to unlock the investment that’s needed in order to transfer away from the fossil fuels and ‘brown’ industry.

“A slew of green tech investment is occurring for nascent technologies around carbon capture.”

“I was reading a study that says by 2030 we expect more than a trillion dollars per year from the investment side going towards solar, wind, hydrogen, carbon capture and sequestration—new technologies that are needed to prevent us from getting to that ‘two-degree world’.”

She adds: “In order to create the support that’s needed so these projects can move forward and they can create a return to continue to encourage that investment, we need insurance products to support that growth.

“A slew of green tech investment is occurring for nascent technologies around carbon capture that also need investment—and insurance to protect those investments.”