Impacts and threats of climate change
During the last decade, the increase in weather-related risks, global warming and climate change have become major issues in public debate and have impacted public decision-making.
In the 1/2006 issue of Risk Consulting magazine, we highlighted the views of Ernst Rauch, the Head of Munich Re’s Corporate Climate Centre, regarding the impacts and threats of climate change. What is the situation, today? How well have we succeeded in climate change prevention?
According to Rauch, there has been a very clear trend in the progress of weather-related risks and climate change over the last decade. “The number and frequency of losses arising from weather phenomena has continued to increase.
As I mentioned in Risk Consulting magazine in 2006, the quantity of economic and insured losses, caused by weather phenomena, reached their highest ever level, in 2005. In 2011, we experienced a new record high, when economic losses, caused by natural catastrophes around the world, amounted to USD 360 billion,” Rauch said.
During the last decade, climate change has been a major issue in public discussions, both nationally and internationally. In 2015, 195 countries signed the Paris Climate Agreement and committed themselves to the goal of keeping global warming under two degrees Celsius. “This is an ambitious goal. To achieve it, we should significantly reduce emissions and the use of coal, by 2050.
Unfortunately, I am not very optimistic, and I doubt whether we can reach our shared goals on a global basis,” Rauch said.
Given the scientific evidence that climate change will continue, we must, first and foremost, respond by adjusting to this change. “We must be able to adjust to global warming and the changes in the weather that it is causing. In the future, we have to expect – with regional differences – even more violent hurricanes, tropical storms, thunderstorms, hailstorms and floods,” Ernst Rauch said.
Authorities and political decision-makers must find solutions for managing the risks associated with weather phenomena and minimising the losses caused by them.
“The insurance industry plays an important role in such work. Climate risk identification and management have become deeply rooted in insurers’ DNA. Through our expertise, we can help our customers, businesses and decisionmakers to adapt to the consequences of climate change and improve resilience against its harmful effects.”
The identification and management of climate risk are deeply rooted in insurers’ DNA.
According to Ernst Rauch, the Munich Reinsurance Company will be paying particular attention to regional variations in rainfall in its, current and near-future, research activities. "Major variations in rainfall cause either drought or floods. In particular, we are monitoring flash floods from severe convective storms and
rises in sea level, as well as the frequency of floods caused by storms in coastal areas.
Our data indicate that particular attention should be paid to flood protection in risk-prone areas. Furthermore, building regulations should be updated, so that buildings withstand more violent storms." Rauch points out that the Nordic Countries should also update their building regulations and perform detailed analyses of the measures needed, in order to adjust to the risks of change from climate change, in general.
"The good news is that, according to the latest scientific research results on climate change, which is supported by Munich Re's NatCatService loss database, no major trends are expected, in the short-term, with respect to weather-related losses or extreme weather conditions in the Nordic Countries, compared to past decades," Rauch concludes.
Head of External Communications Finland, If
Published in Risk Consulting Magazine 1/2017