In its pre-budget submission to the Federal Government, the Actuaries Institute has recognised the serious risks climate change pose to industries and has urged policymakers to review a decision that rejected a proposed disaster resilience fund.
The 2017 Treasury submission, which focuses on maintaining the sustainability and efficiency of the superannuation and the life insurance sectors, noted that climate change is expected to have major environmental, economic, and social impacts to the industries that actuaries advise.
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According to its Natural Disasters Working Group, natural perils cost Australia an estimated $11 billion per year, of which only 40% is insured. It also expressed disappointment over a decision to not go ahead with the $200 million per annum disaster resilience fund proposed by the Productivity Commission in 2015, and recommends that this decision be reviewed.
To inspire confidence in the life insurance sector, and to provide retirees with greater income security and protection, it also proposed the launch of a mechanism for facilitating the rationalisation of life insurance products; the quick set up of a Comprehensive Income Products in Retirement (CIPR) framework; and the removal of any social security means testing and taxation policy settings that constrain CIPR development and consumer take-up.
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Global insured disaster losses hit four-year high