Swiss Re recommends new forms of private-public partnerships to tackle climate adaptation

Some full disclosure – I used to work at Swiss Re. From the Finchannel: According to Swiss Re, new forms of private-public partnerships are required to anticipate and respond to the risks related to climate change. Today, at the International Disaster and Risk Conference (IDRC) in Davos, Peter Forstmoser, Swiss Re’s Chairman of the Board of Directors, presented the benefits of a risk management approach to climate adaptation.

The impact of hazardous events is continuing to rise, driven by interacting forces, including global warming, population growth, density of assets and the increasing vulnerability of ageing infrastructure. Such developments and the exposure to climate change in general fall disproportionately on developing nations, partly due to their limited capacity to adapt financially.

…Peter Forstmoser, Swiss Re’s Chairman of the Board of Directors, said at today’s International Disaster and Risk Conference (IDRC) in Davos, Switzerland: “To cope with the financial consequences of climate-related disaster risks, new forms of private-public risk transfer will allow governments, development banks or NGOs to leverage their funds through the use of insurance and capital market instruments.”

Swiss Re recently secured a lead role in the Caribbean Catastrophe Risk Insurance Facility (CCRIF). This facility is a good example of how new forms of public-private risk transfer can make societies more resilient by securing finances before an event occurs. Established in 2007, the CCRIF insures government risk. It is designed to limit the financial impact of catastrophic hurricanes and earthquakes to 16 Caribbean governments by quickly providing short-term liquidity when a policy is triggered by an event.

…Swiss Re believes that a Country Risk Officer, comparable to the role of a Chief Risk Officer which is common today in global corporations, is a useful model to develop an integrated perspective across the social, economic and environmental risks of a country. The Country Risk Officer would take the lead in creating a national risk landscape, promoting the common understanding and forward-looking dialogue essential for risk prevention and adaptation measures.

Destruction in Sauk Rapids, Minnesota after the 1886 tornado. Wikimedia Commons