‘Slow-burn’ climate risks for life and health insurers flagged in Swiss Re Institute report
Climate change risks are a key focus for the insurance sector but its “slow-burner” effect on public health and how that will impact insurers has been flagged up as one to watch in the 2019 SONAR report from the Swiss Re Institute.
The report said that the reinsurer has been monitoring emerging risk related to climate change since 1989 but heatwaves, floods, droughts, fires and vector-borne diseases present an existential threat.
The institute said that unless action is taken mortality rates and healthcare costs could soar, with significant consequences for the health, workers' compensation and life insurance lines of business.
"Swiss Re and the insurance industry at large first flagged climate change as an emerging risk many decades ago", said Patrick Raaflaub, Swiss Re group chief risk officer. "The risk has now 'emerged' but associated and challenging uncertainties still remain, such as the implications on Life & Health insurance.”
The report also highlights a number of emerging trends such as the clash between digital technology and embedded legacy infrastructure, security risks and the rollout of 5G mobile networks, the wider adoption of genetic testing, and the tightening of fiscal and monetary policy flexibility.
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