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ClimateWise Insurance Group

ClimateWise Insurance Group

Responding to the Risks and Opportunites of Climate Change

What is ClimateWise?

"This is just the beginning of the process of real change. Time is a luxury we do not have and I urge companies both at home and internationally to sign the ClimateWise principles and take the necessary action."
HRH The Prince of Wales

ClimateWise is the global insurance industry’s leadership group to drive action on climate change risk and is facilitated by CISL.

Our international membership covers Asia, Europe, North America and Southern Africa.

The group leverages the insurance industry’s expertise to better understand, communicate and act on climate risks. Members commit to action against the ClimateWise Principles and are independently reviewed against these annually.

The members of ClimateWise have been working together since 2009 on a number of collaborations to further develop cross-industry responses to the challenge of climate change, as well as continuing to offer a common and progressive insurer voice to the international policy-making process under the UNFCCC.

The ClimateWise Principles

The ClimateWise Principles were launched in September 2007 by HRH The Prince of Wales, who had previously called on the insurance industry to offer a more proactive and collaborative effort to help reduce the risk of climate change for us all.

The ClimateWise Principles provide a holistic framework for action by insurance companies covering all aspects of their business operations, including their investment strategies, how they raise customer awareness of climate risk and encourage behavioural change with products and services and also how they inform public policy. All ClimateWise members produce an annual report detailing their activities against the ClimateWise Principles and an independent review is published by a third party.

ClimateWise members undertake collaborations to support the Principles where action needs to be taken at the industry or system level. Collaborations may involve insurers, other businesses, policymakers and academics.

ClimateWise Building Resilient Cities

Ensuring cities – increasingly the beating hearts of economies and society – are adapted to climate impacts is intrinsically an issue of interest to all. Strengthened climate resilience will be the foundation for confidence, on-going investment and sustainable growth.

Why cities?

The dramatic rise in weather-related losses over recent years poses challenges to the liveability and insurability of different geographies. Further, losses associated with climatic events are increasingly concentrated in urban regions.

The resilience of cities to the risks of climate change is an area of increasing focus for the public and private sectors. The concentration and value of assets, expanding populations and the economic importance of these urban centres – plus the infrastructure that support them – mean that collective effort by all stakeholders is crucial for ensuring that cities can withstand the potential impacts of an increasingly unpredictable climate.  

Why this group?

Efforts to build climate resilience in cities have historically been led by public policy and planning approaches. However, the pace and scale of investment and behaviour change required to ensure cities are prepared for future risks mean that the private sector has a crucial and catalytic role to play.

Insurers, working with other partners, can use their strategic view of societal risk management to propel our thinking forward and focus us on what needs to be done to head off these risks.

In 2012 and 2013, a workshop series was designed and delivered in the US and Canada, bringing together insurance industry leaders and city stakeholders in Boston, San Diego and Toronto. By focusing on creating a systematic understanding of where there could be mutually beneficial collaboration between these stakeholders, practical actions to take forward were identified.

Key outputs

In November 2013, three practical documents were published which form the output from this process:

  • A concise Summary Report, which distils the key priorities that emerged from the workshop series for collaborative action between key urban resiliency stakeholders to build climate resilience in cities. This concise summary is designed to be readily understood so as to catalyse and expand cross-sector collaboration.


  • A second, more detailed report “Building Resilient Cities: From Risk Assessment to Redevelopment” explains, in much greater detail, one of the core concepts developed through our workshop series. This new strategic planning framework, called a “Resilience Zone” is introduced and explored through a four-stage development process.


  • A third document which contains the workshop materials including templates and graphics that were used to facilitate each of the workshops in the series. We are making these available so that city leaders, and other urban resiliency stakeholders may organise their own multi-stakeholder workshops.

The partners

CeresICLEI-Local Governments for SustainabilityThe Next Practice, and an Insurance Advisory Panel, composed of senior executives  representing Aviva Canada, The Co-operators Group Ltd and Swiss Re.  

Reports

Priorities for Collaborative Action (pdf)

From Risk Assessment to Redevelopment (pdf) 

Building Resilient Cities Toolkit (zip file)  

Further information

Read more about this work and its background.

Global Insurance Industry Statement

Global Insurance Industry Statement

Building climate and disaster resilient communities and economies: How the insurance industry and governments can work together more effectively.

The need for action

Since the 1980s, the number of loss-relevant weather-related catastrophes has almost tripled in comparison to the number of geophysical events over the same period of time. The recent IPCC 5th Assessment Report supports analysis that the effects of global warming are aggravating risk situations around the world. Without rapid and ambitious action to reduce global greenhouse gas emissions, the capacity to keep global temperature rises within limits considered manageable or 'safe' will narrow significantly, leading to major shifts in risk landscapes worldwide and threatening human and economic wellbeing. Both public and private actors need to engage in a broader societal discussion about the use of insurance in the context of climate- and disaster-resilient development.

Multi-sector collaboration at the international level

Important international public policy processes, frameworks and platforms to promote sustainable development are on the global agenda, which will have a bearing on the role that insurers can play in contributing to resilience. Engaging in dialogue with these processes creates an opportunity for the insurance industry to create new business, address risks to their operating environment and enhance their reputation.

The joint insurer statement

ClimateWise, in partnership with The Munich Climate Insurance Initiative (MCII) and the United Nations Environment Programme Finance Initiative (UNEP FI), together representing a significant proportion of the industry, developed a joint statement. This statement sets out a number of key areas of action that insurers have agreed to take forward and recommendations for the wider multilateral community.

This statement was first presented for discussion at the Caring for Climate Business Forum in Warsaw, Poland on 19 November 2013.

Next steps

The insurance industry, over decades, has proven that economically sustainable disaster prevention works. Risk prevention is an investment in a safer world and long-term partnerships are key to building more resilient communities. ClimateWise members and partners will take forward the statement’s recommendations, in other international fora, in order to support widespread action on disaster risk reduction and climate change mitigation and adaptation and create a constructive space for future more specific action.

Download the joint international insurer statement (pdf).

Read more about these themes on the ClimateWise website.

19 November 2013: Building climate-resilient cities: ClimateWise publishes priorities, planning framework and toolkit

Urban resilience against the weather effects of climate change is an imperative of the insurance industry. It reduces losses, promotes insurability, and presents opportunities for innovative risk transfer and insurance solutions to help manage climate risk. Insurers’ knowledge of risk management enables them to propel thinking on urban resilience forward, and identify ways to reduce climate risks.

Three documents form the output of a workshop series on building urban resilience, involving insurers and city stakeholders in the US and Canada.

19 November 2013: Global Insurance Industry Statement

Without rapid and ambitious action to reduce global greenhouse gas emissions, the capacity to keep global temperature rises within limits considered manageable or 'safe' will narrow significantly, leading to major shifts in risk landscapes worldwide and threatening human and economic wellbeing.

ClimateWise, in partnership with The Munich Climate Insurance Initiative (MCII) and The United Nations Environment Programme Finance Initiative (UNEP FI)) together representing a significant proportion of the industry, have developed a joint statement which sets out a number of key areas of action that insurers have agreed to take forward and recommendations for the wider multilateral community.

Read more and download the statement.

July 2013: ClimateWise Thought Leadership, Issue Four: As risk experts do insurers really communicate risk effectively?

ClimateWise Thought Leadership Issue 4 

How risk is perceived is key to whether people take action to manage risk. Advertisers use insights from behavioural science all the time but it is not often considered when looking at responses to unexpected events. Insurers who are able to effectively communicate risk will be better able to promote desirable risk behaviours.

In this latest article, Ian Foy, Former Chief Executive Officer, Equity Red Star looks at how insurers can connect with customers to drive change and encourage changes in their behaviour - even when they lack personal and emotional connection to major events and trends.

Download ClimateWise Thought Leadership Article Series Issue Four.

16 April 2013: ClimateWise Principles – Developing New Compliance Criteria

ClimateWise leverages the insurance industry’s expertise to better understand, communicate and act on climate change risk. Members, comprised of representatives from all parts of the industry, commit to action following six key principles and are reviewed against these annually.

We are currently revising the compliance criteria to ensure that assessment of member activity continues to drive action and to allow for a clearer measurement of impact.

Proposals are now being requested to develop this new compliance criteria. Read further details.

The deadline for submissions from interested parties is Tuesday May 14 2013 at 17:00 BST.

27 March 2013: Building Resilient Cities: San Diego Workshop

The latest in a series of physical workshops to develop the ClimateWise Resilient Cities Collaboration took place in San Diego on 27 and 28 March 2013, kindly hosted by the University of San Diego. Over 50 senior leaders from US and Canadian insurance and reinsurance companies, infrastructure providers, commercial property owners and investors and city and state authorities met together to identify ways in which collaboration can really be made to work to create a more climate-resilient San Diego.

Read more on the ClimateWise website.

February 2013: ClimateWise Thought Leadership: The role of insurers in strengthening business resilience to climate risk

ClimateWise CCS Report

Kunio Ishihara, Chairman of Tokio Marine & Nichido Fire Insurance, Japan's leading general insurance company, has written for ClimateWise's Thought Leadership series. His article discusses the role of insurers in supply chain resilience, and where climate change poses particular threats to these supply chains across Asian markets.

Download ClimateWise Thought Leadership Article Series Issue Three.

22 November 2012: New ClimateWise study could remove an obstacle to Carbon Capture and Storage

 ClimateWise CCS Report

A new study from ClimateWise could remove an obstacle to Carbon Capture and Storage (CCS), but risk sharing with government is still required.

The 'Managing Liabilities of European Carbon Capture & Storage' risk-management study identifies the potential to remove a barrier to the development of CCS technology at scale in Europe, paving the way for more effective action to prevent climate change. The proposal put forward addresses the problem of unlimited liability associated with the risk of leakage of carbon dioxide from storage sites.

Read the Press Release.

Read the Full Report.

Read the Summary for Decision-makers (12 pages).

 

22 November 2012: ClimateWise marks its Fifth Anniversary with London Summit

ClimateWise CCS Report

This year marks the Fifth Anniversary of the ClimateWise initiative. Since its establishment members have made significant progress towards understanding and responding to the risks and opportunities posed by climate change. The group continues to play a clear leadership role for the wider insurance industry.

The 5th Annual Review, independently conducted by PwC, shows that in 2011/12 members achieved record compliance of 92% with the core ClimateWise Principles. Of particular note were advances in research and data for modelling risk, increased engagement with policymakers, and the development of new products and services.


Read the 5th Annual Review Executive Summary.

Visit the ClimateWise website to download the full report.

 

22 May 2012, Insurers and Suppliers Adopt Sustainable Claims Guidance

Reducing the environmental impact of the claims process can be cost-effective and of benefit to customers. Contact the ClimateWise Secretariat to sign up to industry-wide guidance launched at the Association of British Insurer’s Property Conference.

Read more.

10 April 2012, Fifth ClimateWise Review: Request for Proposals

ClimateWise is requesting proposals to carry out the fifth independent review of adherence to the ClimateWise principles.

The deadline for submissions from interested parties is Tuesday May 8, 2012 at 17:00 GMT.

Read more on the ClimateWise website.

The ClimateWise Fourth Annual Summit

21 November, 2011

1 October 2011, New Chairman of ClimateWise

Mr John R Coomber, member of the Board of Directors of global reinsurer Swiss Re, will become the new Chairman of ClimateWise on 1 October 2011. Mr Coomber succeeds Andrew Torrance, CEO of Allianz Insurance, who has completed his three-year term.

Read the press release.

Read an opinion piece by John Coomber: How do we protect growth in a world of ‘new normals’?

Building Resilient Cities Collaboration

The dramatic rise in weather-related losses over recent years poses challenges to the liveability and insurability of different geographies. Further, losses associated with climatic events are increasingly concentrated in urban regions, not least because of the concentration of economic assets found in cities.

This collaboration aims to produce a systemic understanding of where the business models of the micro-economic players and the macro-economic enablers in a city already overlap, and therefore enable collaboration to achieve greater resilience, and where they do not, preventing the collaborative response that many call for.

In November 2013, three practical documents were published which form the output from this process. These three documents form the output of a workshop series on building urban resilience, involving insurers and city stakeholders in the US and Canada.

Read about the collaboration’s latest work.   

Carbon Capture and Storage (CCS) Collaboration

For Carbon Capture and Storage (CCS) to play a meaningful role in reducing CO2 emissions to the atmosphere while fossil fuels continue to feature in our energy mix, the technology must be commercially deployable. If this can be achieved, significant new economic activity in the energy sector beckons.

CISL has run a series of workshops and has identified appropriate industry and academic expertise to support this collaboration. The process is enabling ClimateWise members to understand in more detail the nature of the long term liabilities of most concern to prospective CCS operators, and to work to understand how different Financial Security instruments could technically be developed in a commercial marketplace context.

Read about the collaboration’s latest work.

Sustainable Claims Collaboration

This collaboration aims to identify how the insurance industry as a whole can reduce the environmental costs of the claims process.

The first stage of this collaboration culminated in the Sustainable Claims Management report in 2010. With a focus on domestic property claims, the report takes into account the lessons learnt from similar initiatives within the motor and commercial property sectors and identifies many low-cost or no-cost opportunities for insurers to increase the sustainability of the process by which insured property is indemnified. 

Guidance on implementing a process to reduce the environmental impact of domestic property claims, applicable to all types of business, was launched at the 2012 Association of British Insurer’s Property Conference.

Read about the collaboration’s latest work.   

Climate Risks and Opportunities for Investment Collaboration

Not mitigating climate change has serious implications for corporate performance. Consequently investment allocation and portfolio management that does not take into account climate risks and opportunities will undermine long term growth and financial stability.

ClimateWise members are taking both a qualitative and quantative approach to considering the impact of climate risks and opportunities as they relate to asset allocation. Building on the Mercer ‘Climate Change Scenarios Study – Implications for Strategic Asset Allocation’, both a review of existing practice and a consideration of regulation as it impacts on the materiality of climate risks and opportunities is being undertaken.

Read about the collaboration’s latest work.

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Contact Us

For more details, please contact:

Katharine Thoday
Programme Manager

T: +44 (0)1223 768857
katharine.thoday@cisl.cam.ac.uk

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