In April 2024, the National Financial Regulatory Administration released the “Guiding Opinion on Promoting the High-Quality Development of Green Insurance,” setting out key risk management objectives in two phases. By 2027, the focus will be on enhancing risk reduction services and management mechanisms within green insurance. By 2030, there will be significant improvements in the level of risk protection offered by green insurance and the scope of green investments by insurance funds. Biodiversity risk, which is closely related to climate risk, is receiving increasing attention in the green insurance sector. This paper, authored by Dr. Yichen Shi and Yang Chenhui of IIGF, CUFE, explores the critical aspects of biodiversity risk for insurance institutions, including its importance, transmission mechanisms, management opportunities, and potential challenges, with the aim of improving risk management practices.