Facts & stats
Future temperature change is dependent on levels of atmospheric greenhouse gases, in particular carbon dioxide, and to a lesser extent methane and other greenhouse gases.
Atmospheric carbon dioxide concentrations are rising fast due almost entirely to human activity. Current levels are the highest for at least 650,000 years.
In the past about half of all carbon dioxide emissions have been absorbed by natural ‘sinks’ in ecosystems and oceans. However, rising temperatures could reverse this process.
Methane is also known to contribute to temperature change. Concentrations have risen fast and are now at their highest for at least 420,000 years.
What does it all mean?
The growing body of evidence on greenhouse gases suggests that climate change is inevitable. Even if man stopped producing greenhouse gas emissions immediately, we will still experience rising temperatures for decades to come and sea temperatures will continue to rise for many centuries.
What next?
The insurance industry must start actively adapting in response to greenhouse gas trends if it is to survive.
- The industry should invest both time and money in business focused academic research – considerable work is needed to convert scientific predictions into practical guidance for the industry.
- Going forward, we believe that the insurance industry should take a new approach to underwriting looking ahead and not simply basing decisions on historical patterns.
- In the longer term, strategists will want to consider the future insurability of weather-related risk.
