Insurance risks rarely stand still. Technology changes, weather patterns evolve and businesses become dependent on increasingly connected systems. Therefore, understanding emerging risks has become an important part of protecting homes, businesses and livelihoods.
Welcome to The Dolmen Monday Insurance Brief, our weekly look at important developments shaping the insurance landscape.
This week, we look at four areas attracting attention across the insurance sector:
- The growing financial impact of extreme weather and flooding
- The changing scale and cost of cyber incidents
- Artificial intelligence and the new risks it could create
- Europe’s significant climate insurance protection gap
While these issues are very different, they share an important theme. Risk is changing, and insurance must continue changing with it.
Flood Risk Is Becoming a Bigger Insurance Issue
Flooding remains one of the most significant weather-related risks facing homes, businesses and communities.
For Ireland, this issue has particular importance. Heavy rainfall, coastal exposure and localised flooding can cause substantial damage within a short period. However, the insurance conversation increasingly extends beyond what happens after a flood. Attention is also turning towards prevention, resilience and the availability of affordable insurance in areas with known flood exposure.
This creates an important question for homeowners. How well do you understand the flood risk associated with your property? The same question applies to businesses. A flood can damage buildings, stock, equipment and critical infrastructure. Furthermore, disruption can continue long after the water disappears.
Therefore, property owners should consider both physical damage and potential interruption when assessing their exposure.
Practical resilience measures can also make a difference. Improved drainage, flood barriers and suitable property modifications may reduce potential damage. Consequently, flood risk management increasingly requires cooperation between property owners, government, local authorities and the insurance sector.
Cyber Risk Continues to Evolve
Cyber insurance has developed rapidly during the past decade. However, the underlying risks have developed just as quickly.
Businesses now depend heavily on email, cloud software, payment platforms and digital customer records.
As a result, even relatively small businesses can have substantial digital exposure. Cyber claims data also demonstrates how significant these incidents can become. Chubb’s 2026 Cyber Claims Report analysed historical claims through December 2025. The research highlights changing claim frequency and severity across different business sizes and industries.
Meanwhile, ransomware continues to represent a major source of cyber claims and financial loss. However, the direct ransom payment represents only one potential cost. Businesses may also face system restoration expenses, lost revenue, specialist investigation costs and reputational damage. Moreover, a cyber incident can interrupt normal operations for days or even weeks. Therefore, cyber resilience should involve more than purchasing insurance.
Businesses should consider employee training, multi-factor authentication, reliable backups and clear incident-response procedures. Insurance can then form part of a broader risk-management strategy.
Artificial Intelligence Creates a New Insurance Question
Artificial intelligence has quickly moved from an experimental technology into everyday business operations. Employees now use AI to draft documents, analyse information, generate content and improve productivity. However, increased adoption creates new questions for businesses and insurers.
What happens when confidential information gets entered into an AI platform? Who carries responsibility when AI-generated information causes a financial loss? Furthermore, what happens when existing insurance wording never anticipated modern generative AI?
The International Underwriting Association recently highlighted this issue within cyber insurance. Existing cyber policy definitions could potentially capture some AI-related incidents unintentionally. The situation has similarities with the earlier debate surrounding so-called “silent cyber” exposure.
However, AI introduces an even broader range of potential scenarios. These could involve privacy breaches, incorrect information, intellectual property disputes and automated decision-making. Consequently, AI governance may become increasingly important when businesses arrange insurance.
Companies should understand which AI platforms employees use and what information enters those systems. Clear internal policies can also help reduce unnecessary exposure. Most importantly, businesses should avoid assuming every AI-related event automatically falls within existing insurance protection.
Europe’s Climate Insurance Gap Continues to Grow
Perhaps the most striking statistic this week concerns Europe’s exposure to extreme weather.
According to the European Environment Agency, weather and climate-related extremes caused an estimated €822 billion in economic losses across the EU between 1980 and 2024. Remarkably, approximately one quarter of those losses occurred during the final four years of that period. Yet only around 25% of climate-related catastrophe losses are insured across Europe. That leaves a substantial protection gap. Floods, storms, wildfires and other extreme events can create enormous financial consequences for households, businesses and governments.
Therefore, the challenge extends beyond insurance.
Europe will increasingly need investment in adaptation, stronger infrastructure and better risk-management measures.The European Union is already considering ways to address the climate insurance protection gap. These include potential approaches involving greater cooperation between public and private sectors. For businesses and homeowners, however, there is a simpler lesson. Understanding your exposure before an event occurs remains essential.
The European Environment Agency provides further information and data on the economic losses associated with weather and climate-related extremes across Europe.
What Does This Mean for Insurance Customers?
This week’s developments demonstrate how quickly the risk landscape continues to change. Flood exposure is becoming more important. Cyber incidents remain costly. AI creates entirely new questions. Meanwhile, climate-related economic losses continue accumulating across Europe. However, insurance should never simply be about reacting when something goes wrong.
Good risk management starts much earlier.
It means understanding potential exposures, reviewing existing protection and identifying areas where circumstances have changed. For businesses, that could mean discussing new technology, cybersecurity procedures or changing operations with your broker. For homeowners, it could involve reviewing rebuilding costs, flood exposure or significant changes to a property. Ultimately, insurance works best when cover reflects the risks that actually exist today.
At Dolmen Insurance Brokers, we believe regular conversations and careful risk assessment can help clients make better-informed insurance decisions.
And next Monday, we’ll return with another Dolmen Monday Insurance Brief, examining the developments worth watching across the insurance landscape.
Disclaimer
The information contained in this article is provided for general information purposes only and does not constitute insurance, legal, financial or risk-management advice. Insurance requirements, policy terms, conditions, limits and exclusions vary according to individual circumstances and the relevant insurer. Information and statistics were considered accurate from the cited sources at the time of publication but may subsequently change. You should obtain appropriate professional advice and review the applicable policy documentation before making decisions regarding insurance cover.
References: https://www.eea.europa.eu/en/analysis/indicators/economic-losses-from-climate-related
