Chapter 10: Insurance instruments for climate-resilient development
Swenja Surminski 10.1 INSURANCE AND CLIMATE-RESILIENT DEVELOPMENT An important aspect of climate-esilient development is managing the r risks from growing climatic extremes, which pose a threat to both short- term economic stability and long-erm sustainable development (Benson t and Twigg, 2007). From 1995 to 2010,1 natural disasters affected 3.6 billion people and created $900 billion in damages in non- rganisation for O Economic Co- peration and Development (OECD) member countries. o Damages are rising further due to high population growth, an increase in assets in risk areas as well as the influence of climate change (World Bank, 2013). In its Fifth Assessment Report, the Intergovernmental Panel on Climate Change (IPCC) finds growing evidence of climate change as a ‘threat multiplier’, which together with a significant adaptation deficit in both developing and developed countries means that the magnitude of impacts and consequences of climate change is expected to increase s ignificantly (IPCC, 2014). An important example of how climate change and other risk drivers interact is population growth. About 800 million people are currently living in flood- rone areas, of which on average about 70 million people p are experiencing floods each year (UNISDR, 2011). Even without any climatic changes, the exposure of flood risk is expected to increase with population growth. A World Bank study into impacts of sea-evel risk l and storm surges for 393 cities in 31 developing countries found high asymmetries in projected impacts, when taking into account population growth and economic development: ‘Our results suggest...
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