July 13, 2004 by Canadian Underwriter
Even as some countries prepare to comply with the Kyoto Protocol, new research suggests greenhouse gas emissions are on the rise, and the global warming impact of these emissions will surely cause more intense weather events for insurers to deal with.
The report “Climate Change 2004”, by Prof. Bill McGuire, director of Benfield Hazard Research Centre, finds that seven years after the Kyoto Conference on Climate Change, and four years from the start of the protocol period, greenhouse gas emissions have risen by 10%. Kyoto requires countries to reduce such emission by 5.2% below 1990 levels between 2008-2012.
The rate of increase for atmospheric carbon dioxide is on the rise, with rates up 1.5 ppm per year in the 1980s and 1990s, but up 2.5 ppm in 2002 and 2003, Prof. McGuire notes.
The result is an observable increase in global warming, he says. Since 1997 the planet has experienced five of the hottest years on record, and since 1990, there have been 10 of the hottest years on record. “The Earth is now hotter than at any time in at least the last 400,000 years and worst case scenarios now visualize temperatures rising by a staggering seven to 10 degrees Celsuis by the end of the century.”
The result, McGuire says, will be more extreme weather events, including drought, floods, wildfires and heatwaves such as the one which overtook Europe last summer. “In the year 2000, one in 30 of the global population was affected by natural hazards. By 2100, it is not impossible that climate-related natural hazards will impinge upon the lives of everyone on the planet.”
Urban centers on coastal locations or rivers are particularly vulnerable, he adds, and insurers must take note of this rising loss threat.
Moreover, it is likely too late to reverse the warming trend, McGuire concludes, leaving only short-term fixes such as storing carbon dioxide underground to mitigate the impacts of global warming.