Innovative insurance solutions key to financing the rising costs of climate risks

by Artemis on September 20, 2010

More than 3.4 billion people worldwide are already threatened by natural hazards, most of them in the developing world. Climate change could make matters even worse. Innovative insurance solutions offer these large populations more adequate financial tools  to help them cope with the growing risks in a changing climate‘ says the second page of a new report from Swiss Re titled Weathering climate change: Insurance solutions for more resilient communities.

It’s the latest report from Swiss Re which looks at the increasing threat of catastrophe risks caused by a changing climate and discusses how innovation within insurance and reinsurance can help to protect communities and make them more resilient to climate extremes. The report looks at risk transfer and how that can help societies adapt to climate change and minimise the financial impact of large natural disasters.

“Insurance is an effective method to finance the costs of climate-related disasters,” says Matthias Weber, Swiss Re’s Division Head Property & Specialty. “It is most effective when viewed as an integral part of a much broader climate adaptation strategy.”

The report goes on to discuss some of the difficulties around quantifying the risks and discusses some solutions which are already proving effective at protecting communities.

Swiss Re make the case for effective risk transfer and public-private microinsurance initiatives as useful tools now available to countries in disaster prone regions of the world.

You can read the full press release from Swiss Re here and download the report in PDF format here.

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