Climate change, Panetta (Bankitalia): "200 billion in damages from extreme events"

The governor of the Bank of Italy spoke at the Green Swan Conference 2026, underway in Manila, recalling that "a significant part of the losses caused by natural disasters remain without insurance coverage. This protection gap exposes families and businesses to serious financial difficulties and often forces governments to intervene after disasters, with considerable burdens on public finances"

"Climate change that was previously seen as a threat to future generations is already having economic and financial consequences." This was stated by the governor of the Bank of Italy Fabio Panetta in his speech at the Green Swan Climate Conference in Manila, underlining how climate policies "must be economically viable, socially sustainable and institutionally credible". "Excessive rigidity or frequent changes can undermine public consensus and jeopardize investments." "Our economies and financial systems must be able to absorb climate shocks without allowing them to turn into a broader crisis".

"A mix of public-private coverage against climate damage"

For Panetta, public-private collaboration is crucial to address damage resulting from climate and natural disasters. The governor of the Bank of Italy then cited the Italian rules for compulsory insurance for catastrophe risks. At the climate conference in Manila Panetta noted that in the world "a large part of the losses caused by natural catastrophes remain uninsured. This gap in protection leaves families and businesses exposed to financial losses and often forces governments to intervene with considerable costs on the public budget". Damage from the climate can spread to banks and the economy and public finances, the governor notes, and for this reason insurance has a central role since it also encourages "prevention when it provides financial incentives to reduce exposure to natural damage". However, expanding insurance coverage can be difficult, with premiums judged to be too high and or difficult to calculate. For this, "we need a framework" that "combines private insurance, reinsurers, public guarantee" in the most extreme cases and capital market instruments".

"Responsibility for climate policies lies with governments"

Panetta, in his speech, explained that in 2025 direct damages "from extreme climate events" have doubled compared to the early 2000s, reaching 200 billion dollars, underlining how "the responsibility for climate policies" lies "first of all with governments that have the democratic legitimacy and the tools to guide the ecological transition". According to the governor, however, central banks also have "different and clear responsibilities". "We need - he underlined - to understand how climate risks affect inflation, economic activity, financial stability, financial supervision". This is not "an expansion of our mandate but just implementing it in a changing context", he concluded.