Munich Re

Insuring a World of Disasters

ARCHIV - Hochwasser herrscht am 03.06.2013 in Passau (Bayern). Laut einer jährlichen repräsentativen Umfrage der R+V Versicherung fürchten sich die Deutschen am meisten vor steigenden Lebenshaltungskosten, Naturkatastrophen und dem Pflegefall im Alter. Der größte Angstmacher in Deutschland bleibt die Euro-Schuldenkrise. Foto: Andreas Gebert/dpa (zu dpa «Ängste der Deutschen: Größte Sorge bleibt die Eurokrise» vom 05.09.2013) +++(c) dpa - Bildfunk+++
Flooding will become an increasingly widespread problem as the planet warms up.
  • Why it matters

    Why it matters

    One of the most critical items on the U.N. Climate Conference agenda is helping poorer nations by creating a form of climate risk insurance.

  • Facts

    Facts

    • The United Nations Climate Change Conference in Paris takes place from November 30 to December 11, 2015.
    • The summit blueprint is called “Transforming Our World: the 2030 Agenda for Sustainable Development” and contains goals and targets to wipe out poverty, fight inequality and tackle climate change.
    • Munich Re was founded in 1880.
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  • Audio

    Audio

  • Pdf

When the United Nations conference convenes in Paris this December to craft a new global climate agreement, it will not only discuss measures wealthy nations can take, but also will look to aid the most vulnerable nations in adapting to climate change.

Rising sea levels and growing numbers of extreme weather catastrophes cannot be ignored, even if their impact varies greatly from region to region. The Western world is expected to take the greatest financial hit in absolute terms, but poorer countries face a much more daunting future. They not only will be required to deal with severe humanitarian consequences, but also in terms of relative economic strength, will suffer the greatest damage. Thus, adaptation to a changing world is an essential building block for economic development.

The G7 countries have acknowledged the role of so-called “climate risk insurances” to finance climate change – though it would be more accurate to call them “climate change impact risk insurances.”

The G7 nations want to see 400 million people in developing and emerging economies covered by insurance protection against extreme weather events by 2020. On the macro level, this means insurance for entire countries, such as the African Risk Capacity, which provides drought insurance for African countries, while on the micro level it offers insurance for individuals.

Payments would be made in cases of clearly defined weather events determined by objective parameters, whether drought, storm or floods, depending on the insurance needs of the contractual partner. This mechanism makes administration of the program relatively easy and cheap to implement.

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