The impact of climate change is being felt in more ways than ever, according to one industry expert.
Geoffrey Au, APAC chief risk officer for Zurich
, said Asia Pacific is among the most vulnerable regions to the effects of climate change.
“Climate change is exacerbating more risks than ever before in terms of water crises, food shortages, constrained economic growth, weaker societal cohesion and increased security risks,” Au told Insurance Business.
“The social and economic development in the region has resulted in a rapid transition to more urban living, meaning its cities are more densely populated and the impact of natural catastrophes is amplified.”
Climate change was listed as the number two underlying risk in the recently released Global Risks Report 2017, released by the World Economic Forum in association with Marsh
Want the latest insurance industry news first? Sign up for our completely free newsletter service now.
The report also found that, for the first time, all five environmental risks were ranked both high-risk and high-likelihood as extreme weather events were named the single most prominent risk facing the world.
Australia particularly remains on the front line of climate risk. With temperatures hitting record highs across the country in January, the impact climate risk can have remains front and centre for businesses and the public at large.
Au noted that while much has been done in terms of climate risk, a quicker response is still needed.
“2016 did see some progress to address climate and other environmental risks, reflecting firm international resolve on the transition to a low-carbon global economy and on building resilience to climate change.
“However, the pace of change is frankly not fast enough in Asia Pacific or anywhere else.”
Au stressed that the role of the insurance industry is inextricably linked to climate risk. Global insurers can advocate for closer cooperation to develop responses to the challenges that arise in the future.
Global insured disaster losses hit four-year high
Allianz reveals biggest Australian business risks