The Need for Insurers to Plan for Climate Change

The past few years have opened the eyes of many to the interconnectedness the risks of climate change brings to the systems society relies on. There is also an increased awareness of how these risks are not distributed equally across populations or economies.

This McKinsey & Company report furthers the discussion on the risks climate change is bringing to the insurance industry. Though the risks from climate change vary regionally, there is no location that is fully immune to the challenges today or in the near future.

Some insurers may feel protected from the escalating effects so far. However, this is a false sense of safety: while climate risk can change quickly, revisions to policies that are based only on historical data may not reflect the full cost of climate risk.

The insurance industry holds a unique vantage point to help create climate risk mitigation incentives and services. These services will aid in the adaptability and resilience development in the integrated systems society relies on. Moving into a role to help create climate resiliency will put insurance companies in position to make adjustments as regulatory environments catch up to risk mitigation needs and to reduce their exposure to risks.

Opterrix has the innovative tools needed to build climate change predictions into catastrophic modeling, and the means to visualize the results for efficient comprehension and proactive decision-making. Learn more at Opterrix.com.