Expert Opinion | Climate report 2021. To what extent extreme weather events impact the insurance world?

Expert Opinion | Climate report 2021. To what extent extreme weather events impact the insurance world?
A post by:
Léo Génin Léo Génin Associate director
Rébecca Slattery Rébecca Slattery Consultant
Luar Chevrant Luar Chevrant Consultant

The year 2021 was marked by two key publications related to climate change: the Sixth Assessment Report of the Intergovernmental Panel on Climate Change (IPCC) and the Atlas of Mortality and Economic Losses from Weather, Climate and Water Extremes (1970-2019) of the World Meteorological Organization (WMO).

Therefore, it is an opportunity to review the climate events that marked this year. Due to the temporary cooling caused by the La Niña episode, this year is “only” fifth in the list of the warmest years ever recorded. However, this perceived lull should not be taken as a signal that the long-term trend of climate change is being reversed or even halted.

The many climate records broken in 2021 are a sad reminder of this. The number and intensity of these events are increasing, with significant human and economic consequences, and the annual costs to insurance companies are rising considerably. From increasing insurance premiums to greening their investments and developing innovation, insurers are being forced to mobilize various levers of action to deal with climate change.

With this expert opinion, I Care offers an overview of extreme climate events in 2021 and a forecast of how the insurance industry is going to deal with such events in the future.

This expert opinion, written in January 2022, is part of a series of publications called “Yes We Care About” that is published by I Care, and which can be found in the “Insights” section.

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