Climate change impacts on personal insurance

Abstract

Global warming due to human activities triggers different consequences according to the impacted areas. In the north, it causes material damage that insurance, financial, and technical means can help to cope with. In the south, it brings about heavy human losses, accentuated by demography, lack of infrastructure, and low insurance coverage. For the moment, climate change has had little impact on personal insurance results. However, to face the worldwide multiplication of disasters and epidemics predicted by the experts, personal insurers could play an increasing role. They could establish more accurate statistics to evaluate and price the risks. They could also promote risk prevention among their policyholders. As for emerging countries, developing insurance coverage would be the best way to face the consequences of climate change. © 2007 The International Association for the Study of Insurance Economics.