Aon chief executive Greg Case (pictured above) has called for $1 trillion in private capital to enter the insurance sector over the next decade to help address widening coverage gaps for natural disasters and cyber threats.
Speaking to the Financial Times, Case said the industry must expand its capital base to meet rising client demand amid growing volatility. “If we don’t bring in a trillion dollars in alternative capital in the next decade, we’ve failed,” he said.
Case’s comments come as the insurance sector continues to face significant pressure from escalating climate-related losses and a growing frequency of cyber incidents. Aon estimates that since 2000, insurance has covered less than one-third of global natural catastrophe costs. In 2024 alone, economic losses from natural disasters reached $223 million, with just $145 billion insured. Similarly, cyber risk coverage remains limited, with less than one-fifth of corporate information assets insured globally, according to Aon data.
Investors such as hedge funds, pension funds and sovereign wealth funds have already increased their exposure to insurance risks through catastrophe bonds and insurance-linked securities (ILS), which now account for more than $115 billion in capital. These structures offer attractive returns that are largely uncorrelated with broader financial markets but investors interest is heavily dependent on the ability to model and manage risk accurately.
Aon expects alternative capital investment to double over the next five years, driven by both investor appetite and growing demand from companies facing reduced capacity from traditional insurers. “To the extent we can access other pools of capital… we want to bring as much in as we can offset the volatility our clients face,” Case said.
The brokerage has increased its focus on risk transfer innovation to support this shift. Through its parametric insurance solutions, covering risks with predefined triggers like weather data, Aon has scaled up annual placements from 30 to more than 100, securing over $3 billion in capacity. The company is also investing $1 billion in analytics and digital tools, including its Cyber Risk Analyzer and Health Risk Analyzer platforms, to help clients and investors understand exposures more clearly.
Case stressed the need for transparency and better risk understanding to support investor confidence. “If we don’t understand it, you don’t put your capital behind it,” he said.
As insurers limit capacity and global risks continue to intensify, Aon said its strategy underscores the growing role private capital is expected to play in closing the global protection gap.
