The Institute of Actuaries of Australia’s Climate Change Working Group has recently published a paper on climate transition risk for General Insurers. The paper was presented at the Australian Actuaries Institute’s General Insurance Seminar in November.
The paper cites that the landscape of general insurance is changing, driven not just by the physical impacts of climate change, but also by stakeholders such as regulators and investors concerned about climate change, and economic and technological change.
Such factors include the transition to renewables within the energy sector, the impact of emission reductions on agriculture and infrastructure, shifts in global consumer preferences, and increasing demand for climate risk disclosure.
This paper considers various scenarios for how these drivers may play out in the future. It considers the implications for general insurers and discusses where actuaries can provide insight into the possible implications of different climate change scenarios.