Insurance is the world’s largest industry with U.S. $4.6 trillion in revenues - 7% of the global economy - according to Evan Mills, a scientist at the Lawrence Berkeley National Laboratory. It is also an industry that is acutely threatened by climate disruption.
In a study published in the journal Science, Mills says that insurers now pay an average of $50 billion a year in weather- and climate-related insurance losses, including property damage and business disruptions. He says that such claims have been doubling every decade since the 1980s.
In the face of those loses and certainty that they will mount, Evans says that the insurance industry has chosen to invest about $2 trillion (44% of industry revenues) in a variety of initiatives in 51 countries:
- supporting climate research;
- developing climate-responsive products and services;
- raising awareness of climate change;
- reducing their own in-house emissions;
- quantifying and disclosing climate risks;
- incorporating climate change into $25 trillion (with a “t”) worth of investment decisions; and
- engaging in public policy
These activities have grown since 2008, when the global economic downturn began. Mills told the Los Angeles Times that, rather than repeating the tired “political rhetoric” that it cannot afford such measures now, the industry instead “believes it can't afford not to” make these investments.
That is the attitude that other industries and governments fail to adopt at our peril.