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At Large
Insurers and Government Partners Can Work Together to Facilitate a Green Future

Reducing greenhouse gases and insuring at-risk communities can mitigate climate change.
  • Tony Kuczinski
  • June 2021
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The signs are all around us. The impact of climate change on the frequency and severity of natural catastrophes is not a new concern for the insurance industry. However, the combination of recent weather events, shifting social attitudes, new public policy goals and corporate efforts has propelled the issue of climate change to the center of the global stage.

For decades, our industry has contributed crucial insight and scientific data to the study of climate change and its effects, both economic and social. We must take the next step.

What actions can we take, as a society and as an industry, that will lead to meaningful change?

Mitigate Greenhouse Gases

Although individual events cannot be linked directly to climate change, there is scientific consensus that greenhouse gas emissions contribute to the rising temperatures in the atmosphere and oceans. Rising temperatures can lead to more frequent and intense weather events, and also can affect atmospheric dynamics, as patterns of natural air systems such as the jet stream are impacted.

Many global organizations have committed to reducing emissions and limiting global warming in line with the goals of the Paris Agreement. It is critical to strive for the 2 degrees Celsius limit of the Paris Agreement to prevent more expensive and drastic challenges for society. While corporate pledges to reduce carbon emissions in business operations and investments are important, industry alone cannot compel the wholesale changes required to move away from our current energy sources. Governments also must take bold steps, such as implementing a carbon tax or a functioning, global emissions trading system that provides sufficiently strong price incentives for a gradual switch to nonfossil forms of energy and transportation.

Close the Insurance Gap

Underserved communities are less likely to buy insurance, which makes them more vulnerable to negative impacts from severe weather events. More widely available insurance coverage for at-risk communities can make it easier for countries and individuals to handle the financial impact of natural disasters. Insurance companies must seek out like-minded partners to develop innovative community-based solutions. Through public-private partnerships, we can raise awareness of the policies needed to reduce the impact of climate change and advance a society that fosters sustainable, resilient communities.

Adapt to Consequences of Global Warming

We have the knowledge to make our homes and commercial structures more resilient to natural hazards, and we need to make those investments. It is also essential that infrastructure, from roads to dams to electric power grids, is resilient to climate change and natural disasters. Strong, resilient infrastructure can help communities recover more quickly from natural disasters. However, vulnerable infrastructure can have devastating impacts on communities, as demonstrated by the recent blackouts and cascading losses due to Winter Storm Uri in Texas. As Congress considers new spending in the United States, enduring resilience should be an essential component of all projects.

The enormity of climate change is daunting, but there is power in partnerships. The actions we take today as a society and as an industry can make a tremendous difference in how we experience and recover from natural catastrophes in the future.

Best’s Review contributor Tony Kuczinski is CEO of Munich Re US P&C Companies. He can be reached at

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