Page 21 - Insurance Times January 2024

Brokers as

Stewards Praveen Gupta

Continues to pursue his passion of exploring,
learning and sharing from the exciting inter-
sections between Climate Crisis, Diversity,
Governance, Risk and Tech. He essays his
passionate views through his blog:
www.thediversityblog.com.

As global temperatures keep rising above pre-industrial times, the stability that we took for granted
is in a state of flux and may head for irreversible consequences. This is due to the overexploitation
of nature, resulting in climate change together with biodiversity loss and pollution.

Praveen Gupta analyses the varied and growing threats and brokers have an important role to play in ensuring that
from climate change and explains why intermediaries the needle does not move towards the latter.
are perfectly placed to help the insurance market
respond. Results from a study by Axa in late 2021 show that 60% of
risk managers fear that certain geographies or activities will
For nearly 10,000 years, humans have had a stable become uninsurable in future due to the impact of climate
environment that allowed 'unhindered' progress. We are change. That future has arrived too soon. Today we are
now in a situation, according to Christina Lu and Brawley seeing many vulnerable locations (particularly the US states
Benson writing in Foreign Policy, whereby "countries have of California, Texas, Louisiana and Florida) in the world's
spent decades building critical infrastructure that is now largest insurance market. Due to devastating wildfires,
buckling under extreme heat, wildfires, and floods, laying severe floods and windstorms, the provision of homeowners'
bare just how unprepared the world's energy and insurance in these locations is becoming near impossible.
transportation systems are to withstand the volatility of
climate change". As global temperatures keep rising above pre-industrial
times, the stability that we took for granted is in a state of
Like the recent pandemic - which was a preview of the flux and may head for irreversible consequences. This is due
unfolding climate crisis - it has begun to adversely touch to the overexploitation of nature, resulting in climate
every life. Rich or poor, in every part of the world. Some change together with biodiversity loss and pollution. Munich
more adversely than others. All that we have built this far Re sees climate change and La Niña as two of the drivers
is for a climate that no longer exists. No form of insurance for a $120bn annual disaster insured loss for 2022. A figure
can protect anyone fully and forever. There is a thin line of $100bn or more is the 'new normal' for the global
between insurable and uninsurable. Insurance intermediaries insurance industry's annual natural disaster loss total.

The Insurance Times January 2024 19