Thursday, November 26, 2009

Munich Re says climate change is one of humanity's biggest challenges

When Munich Re says that the likely contribution of climate change is in the low single-digit percentage, don’t feel that you can relax about global warming. What matters more is how quickly this proporition is increasing. This increase is what has insurers worried. Oliver Suess in Bloomberg: Munich Re, the world’s biggest reinsurer, said climate change is “one of the biggest challenges facing mankind” and must be fought with ambitious targets to curb a costly rise in natural catastrophes. …The average number of major weather-related catastrophes such as windstorms, floods and drought is now three times as high as at the beginning of the 1980s, Munich Re statistics show. “Losses have risen even more,” the Munich-based reinsurer said.

Natural catastrophe losses reached about $1.6 trillion in original values between 1980 and 2008 while insured losses amounted to about $465 billion, according to Munich Re. That compares to overall losses of more than $750 billion and insured losses of about $280 billion in this decade, the company said. “To what extent the increased losses are due to climate change is not yet clear,” Munich Re said in the statement. “Preliminary analyses suggest that it accounts for a low single-digit percentage of annual overall losses.”

To help developing countries, many of them in regions more exposed to natural catastrophes and unable to adapt to the growing danger, Munich Re has founded the Munich Climate Insurance Initiative. MCCI estimates its costs for preventive measures, microinsurance plan support, and funding of a climate insurance pool for the biggest risks will cost about $10 billion a year. “It is expected that items from the MCII program will be incorporated into the final Copenhagen document,” Munich Re said.

The Egyptian Bridge collapse in 1905 in Saint Petersburg

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