Research on the Impact of Climate Change on Insurance Companies

Abstract

The global climate is changing with more and more extreme weather, including typhoons, extreme temperatures and other disasters. Climate change has an extraordinary impact on the insurance industry. However, according to research, a third of insurers are not paying enough attention to the impacts of climate change. This paper analyzes and demonstrates the impact of weather changes from two parts of non-life insurance and life insurance through cases. Taking the typhoon as the cut-in perspective, the impact on the climate is analyzed from three aspects: strong wind, storm surge and heavy rain. Additionally, this article offers some advice to insurers on how to benefit from global events. The findings suggest that insurers should recalculate all catastrophe risks and rebuild risk models. Catastrophe bonds can also help businesses raise capital. Insurers need to recognize how far-reaching climate change will affect the insurance sector, and how risks present opportunities.