Sustainability Principles would allow policymakers to leverage insurance expertise: UN

A set of global principles will allow public policymakers to leverage the experience and information stored within the global insurance industry to help mitigate ‘unknown’ risks and adapt to a changing global climate, said Paul Clements-Hunt, the head of the UN Environment Programme Finance Initiative.
Clements-Hunt spoke at a UN-convened consultation session aimed at developing a set of sustainability principles for the global re/insurance industry. The Co-operators hosted the meeting, the third of a set of seven to be held around the world, at its Guelph, Ontario headquarters.
During his speech, Clements-Hunt said both known and unknown risks seem to be multiplying, and the interconnectivity of these risks is compounding their danger. The global re/insurance industry has proven it has a wealth of experience of dealing with these uncertainties, he continued. By drafting a set of global principles on how to handle these global risks, policymakers will also be able to leverage the knowledge and information stored within the industry, he continued.
He pointed to a McKinsey & Company study that found about $200 trillion will be spent on urban assets worldwide between 2005 and 2025. For every $30 million spent on developing and building cities, only $100,000 of public funds would be available to help those cities adapt to climate change, he said.
“I think those figures are very telling in terms of the challenge within the private sector and the capital markets, and for the insurance industry – how do we mobilize finance and capital to climate-proof our cities, to adapt and be resilient?” he asked.
“We know there is a huge store of experience, data and information that exists within the insurance industry worldwide. We believe that ‘insurance’ thinking should come earlier in the policy process, in terms of advising policymakers around adjustment and adaptation to these emerging risks. The principles for sustainable insurance are about sharing experience of dealing with new challenges.”