Climate risk is turning insurance and resilience into deal factors

As climate risk increasingly influences insurance costs and resilience measures, middle-market credit professionals must reassess deal valuations and risk profiles. Rising premiums and the need for enhanced resilience can materially impact cash flow stability and collateral quality, affecting creditworthiness and loan structuring. Understanding how climate factors reshape underwriting and due diligence is critical for accurately pricing risk and identifying potential stress points in leveraged finance transactions within vulnerable sectors or geographies.