IN SHORT

• Climate change will affect populations in different ways, depending on their geography, demographics and health status.
• Insurers need to identify which impacts will have the biggest effects on their business.
• New approaches such as microinsurance, parametric risk transfer solutions and digital technology could help insurers to close the protection gap.

From vaccinations to industrialisation and even pasturisation of cows’ milk, history holds plenty of examples of human interventions that have dramatically increased, or reduced, humanity’s life span. However, according to Dr Irene Merk, emerging risks ambassador at SCOR, the magnitude of climate change may have an even greater impact on how long we can all expect to live.

“Most importantly, it’s happening faster than the ecosystem can adapt, leading to disruption and higher volatility,” Dr Merk says. “This means that projections of future morbidity and mortality are becoming more challenging, and we are increasingly likely to need protection and resilience against shock events and trends. It’s therefore imperative that companies with long-term business interests, such as life insurers, work towards an understanding of climate change and its direct and indirect impacts on their businesses.”

Complex and variable

The impact of climate change on health and longevity will be complex and multifaceted — in part because its effects are so variable.

“We expect regional disparities to be pronounced,” says Priya Dwarakanath, Swiss Re’s head of Life Research and Strategic Forecasting. “The socio-economic differences in mortality outcomes we can already see may become more pronounced if those in higher income brackets have more access to mitigation measures and healthcare services. There is also likely to be a bigger threat to clinically vulnerable people, including those with comorbidities, the elderly, the disabled, pregnant women and children.”
Swiss Re has also found that, while the effects of climate change on morbidity are gradual and slow-moving, the consequences could be felt for many decades. 

Damien Mu, CEO and managing director of AIA Australia, is yet to see a direct connection between climate change and claims experience, though he has no doubt that related health impacts will develop over time. 

“We are particularly concerned about the impact on chronic conditions, as these are our major cause of insurance claims,” he says.

“For example, in Australia, heatwaves, bushfires, floods and droughts can all affect chronic conditions such as respiratory and cardiac disease directly.

They can also have indirect effects through changes to food availability, as well as a major impact on mental health.” 

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