Even though it is projected to severely impact the world’s poorest, are the fiscal impacts of climate change threat going to affect mostly insurance firms?
By: Ringo Bones
Even though it is the most pressing social justice issue of the 21st Century given that it is the most affluent are creating the problem, climate change severely affects the world’s poorest when it comes to affecting livelihoods and degrading the habitability of communities. But form a fiscal perspective, insurance firms will be the ones most exposed to the climate change threat according to the Bank of England governor Mark Carney. A case in point of insurance firms bearing the fiscal brunt of climate change risks was the 2005 Hurricane Katrina that caused billions of dollars worth of damage.
Insurance firms might be the most exposed to the risk of the climate change threat but financial risk to fossil fuel extraction firms are not merely trivial as well. Future legislation to limit the severity of the impact of climate change could create fossil fuel extraction companies who can’t sell and burn the fossil fuels they have currently access to. Chances are, climate change – at least the preparations to be taken to lessen the severity of its impact – will certainly remodel the global economy into something that’s wholly different than its current form.