Climate change futures: health, ecological and economic dimensions

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RISK SPREADING IN DEVELOPEDAND DEVELOPING NATIONSThe economic costs of recovering from and adapting toweather-related risks are spread among governments(domestically and via international aid), insurers, business,non-profit entities and individuals.The insurance sector is playing an increasing role (surpassinginternational aid) and is the only segment with agrowing tendency to pay for consistently rising losses(Mills 2004). There is an intrinsic logic for fostering agreater role for insurance in climate risk management,as loss prevention and recovery are historically integralto their business.Figure 3.2 Costs of Natural Catastrophes Are Spread Among Many PartiesInsurers & Reinsurers• Domestic• ForeignNational/LocalGovernments• Federal• State• Local• VillageForeign Governments& The United Nations• Bilateral Aid (e.g., USAID)• UNOCHA• UNICEF• UNDPWeatherRisksNon-GovernmentalOrganizations &Private Donors• FAO• Red Cross• CARE• Private FoundationsIndividuals & Firms,as “self-insureds”• Householders (informally)• Companies (formally)95 | FINANCIAL IMPLICATIONSSource: Mills et al. 2001
Extreme weather events are a particularly difficult classof risks for insurers to manage, as the industry mustmaintain the capacity to absorb an uncertain level oflosses from year to year. Overall exposures are mostacute in the developing world, where vulnerability ishigh and preparedness low. India and China aloneexperienced 25% of global economic losses from naturaldisasters between 1994 and 2003 (Swiss Re2004b). Total premiums in the emerging markets representedapproximately US $372 billion/year in 2004or 11.5% of that market, with growth rates often dramaticallyhigher than those in the industrial world(twice as high, on average, over the 1980-2000 timeThe potential for new patterns of events stands to raisedemand for insurance while increasing uncertainty,challenging the industry’s ability and willingness toassume or reasonably price these new risks.Sustainable development is a guideline that can contributeto managing and maintaining the insurability ofthese risks and thereby reducing the need for individualsand domestic governments to absorb the costs.By pooling financial reserves to pay for weather-relateddamages to property, morbidity and mortality, theglobal insurance market provides considerable adaptivecapacity. Moreover, the economic consequencesFigure 3.3 12% of the US $3.2 Trillion/Year Global Insurance Market Is in Developing Countriesand Economies in Transition: 200496 | FINANCIAL IMPLICATIONSMature Markets($2,871 B)EmergingMarkets($374 B)Central and EasternEurope ($42 B)Latin America andCarribean ($49 B)South and East Asia($230 B)Middle East /Central Asia($15B)Africa ($38 B)Emerging markets in underdeveloped nations are a growing part of the global insurance markets. (Micro-financing and micro-insurance areplaying roles in development in some nations.)Source: Swiss Re 2005bperiod), and often exceed national GDP growth rates. 4(See figure 3.3) At current growth rates, emerging marketswill represent half of world insurance premiums bythe middle of this century.Approximately 40% of current-day premiums globallyare non-life (property-casualty insurance), with the balancelife-health. The insured share of total losses fromnatural disasters has risen from a negligible level in the1950s to approximately 35% of the total in 2004(and up to 50% in some years). Insurance market conditionsvary regionally.of extreme weather events are becoming increasinglyglobalized, largely due to the multi-national structureof the insurance and reinsurance markets, which poolsand integrates the costs of risk across many countriesand regions. Foreign insurers’ premium growth inemerging markets averaged more than 20% per yearthrough the 1990s. In the late 1990s, the US alonewas collecting approximately US $40 billion inpremiums for policies placed in other countries.4The US $5-10 billion in claims resulting from the 2004 Indian Ocean Tsunami provided a reminder of the degree to which insurance hasgrown in the developing world.
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Climate Change FuturesHealth, Ecolo
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Table of ContentsIntroductionPart I
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EXECUTIVE SUMMARYClimate is the con
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the past decade, an increasing prop
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THE CASE STUDIES IN BRIEFInfectious
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THE INSURER’S OVERVIEW:A UNIQUE P
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Regulators and governments can empl
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THE PROBLEM:CLIMATE IS CHANGING, FA
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Figure 1.3 GreenlandEXTREMESOne of
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20 | THE CLIMATE CONTEXT TODAYWholl
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Figure 1.5 Global Weather-Related L
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Climate signals in rising costs fro
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CLIMATE CHANGE CANOCCUR ABRUPTLYPer
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28 | THE CLIMATE CONTEXT TODAYCCF-I
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communities, salinizing ground wate
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Health is the final common pathway
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34 | INFECTIOUS AND RESPIRATORY DIS
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Figure 2.4 Malaria and Floods in Mo
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Figure 2.61920-1980CASE STUDIES38 |
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A MALARIA SUCCESSThe New York Times
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A new flavivirus, Usutu, akin to WN
Page 45 and 46: 44 | INFECTIOUS AND RESPIRATORY DIS
Page 47 and 48: One analysis (Vanderhoof and Vander
Page 49 and 50: BIODIVERSITYBUFFERS AGAINSTTHE SPRE
Page 51 and 52: Figure 2.15 RagweedMOLDSLong-term f
Page 53 and 54: ASTHMA COSTSTODAYexamples, the Afri
Page 55 and 56: Stott et al. (2004) calculate that
Page 57 and 58: In the summer of 2005, northern Spa
Page 59 and 60: a better understanding of subpopula
Page 61 and 62: 60 | EXTREME WEATHER EVENTSFLOODSFO
Page 63 and 64: MOSQUITO- AND SOIL-BORNE DISEASESEC
Page 65 and 66: Table 2.2 Direct and Indirect Healt
Page 67 and 68: HEALTH AND ECOLOGICALIMPLICATIONSOu
Page 69 and 70: 68 | NATURAL AND MANAGED SYSTEMSCAS
Page 71 and 72: Figure 2.27 Soybean Sudden Death Sy
Page 79 and 80: 78 | NATURAL AND MANAGED SYSTEMSTHE
Page 81 and 82: HARMFUL ALGALBLOOMSFigure 2.32 Red
Page 85 and 86: CASE STUDIES 84 | NATURAL AND MANAG
Page 93 and 94: “Climate change is one of the wor
Page 95: 94 | FINANCIAL IMPLICATIONS• Incr
Page 99 and 100: 98 | FINANCIAL IMPLICATIONSTable 3.
Page 101 and 102: 100 | FINANCIAL IMPLICATIONSdemand
Page 103 and 104: 102 | FINANCIAL IMPLICATIONSClimate
Page 105 and 106: These include:Solar Photovoltaic Pa
Page 107 and 108: • Social and economic factors in
Page 109 and 110: Finally, new technologies need to b
Page 111 and 112: 110 | FINANCIAL IMPLICATIONSBRETTON
Page 113: 112 | APPENDICESAppendix A. Summary
Page 116 and 117: Table B.1 Summer Percentage Frequen
Page 118 and 119: Climate sensitivity for small-scale
Page 120 and 121: diffuse and do not manifest in sing
Page 122 and 123: APPENDIX D.LIST OF PARTICIPANTS ATT
Page 124: Carmenza RobledoGruppe OekologieEMP
Page 127 and 128: 126 | BIBLIOGRAPHYBibliographyAAAAI
Page 129 and 130: 128 | BIBLIOGRAPHYChordas, L. Epide
Page 131 and 132: Ford, S.E. & Tripp, M.R. Diseases a
Page 133 and 134: 132 | BIBLIOGRAPHYKalkstein, L. S.,
Page 135 and 136: 134 | BIBLIOGRAPHYMills, E. The ins
Page 137 and 138: 136 | BIBLIOGRAPHYRose, J. B., Epst
Page 139 and 140: 138 | BIBLIOGRAPHYVandyk, J. K., Ba
Page 142: Infectious and Respiratory Diseases
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