Swiss Re Corporate Solutions launches Climate Risk Solutions for Corporates in Asia Pacific
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"Companies today are recognizing the need to assess their exposure to climate risk for strategic, regulatory, sustainability, and brand reputation reasons. Swiss Re Corporate Solutions' Climate Risk Solutions enables corporates to quantify the impact of physical climate risk on their portfolios. A natural starting point for broader climate engagement, climate risk assessment forms an integral part of broader risk and business management." Jonathan Rake, CEO APAC, Swiss Re Corporate Solutions
Swiss Re Corporate Solutions, the commercial insurance arm of the Swiss Re Group, has launched Climate Risk Solutions for Corporates in Asia Pacific to help companies assess the impact of physical climate risk on their global portfolios.
Underpinning these climate risk solutions is Swiss Re Corporate Solutions’ intuitive and scientifically robust Climate Risk Score Framework. The framework combines forward-looking climate model data for precipitation and sea-level rise with global flood and storm surge zones to create a high-resolution assessment of physical climate risk.
The suite of climate risk solutions offered spans three tiers, from a portfolio overview in the form of a climate risk score report at the entry level, to the provision of risk mitigation and risk transfer options at the highest level of the service offering.
Among the physical climate risk exposures that companies would be able to better assess and understand are river and flash floods (wet), wildfire and droughts (dry), and storm surges and coastal flooding (sea level rise). Identified climate 'hotspots' can be further delved into to produce explicit economic loss costs associated with climate change impacts.
Many of these climate 'hotspots' are located in the Asia Pacific region, which continues to be disproportionately affected by climate change and secondary perils. As reported in the latest Sigma, the region was hit by 81 large catastrophic events in 2020, suffering over 26% of the global economic losses last year. Insured losses from natural catastrophes were USD 10 billion, representing a USD 53 billion protection gap to the total USD 63 billion in economic losses incurred.
A physical climate risk assessment can help companies identify blind spots and bridge the insurance gap. It is also critical in broader risk management and in safeguarding long-term business interests, including being able to communicate climate-related financial disclosures to customers, investors, regulators and other stakeholders.
- A physical climate risk assessment can help companies to identify, mitigate, and transfer some of these risks to their operations and portfolios, which Swiss Re Corporate Solutions’ Climate Risk Solutions for Corporates aims to do.
- Companies are recognizing the need to be able to assess their exposure to physical climate risk for strategic, regulatory, sustainability, and brand reputation reasons.
- Swiss Re Corporate Solutions uses climate risk scores — leveraging global climate model outputs and transparent methodology — to help customers identify a portfolio’s exposure to climate change risks and maintain sustainability in the long term.
Jonathan Rake, CEO Asia Pacific, Swiss Re Corporate Solutions:
Climate change is resulting in greater frequency and intensity of extreme weather events and natural catastrophes. This has a costly impact on businesses around the world but perhaps more so in Asia where coastal cities are prevalent. Coupled with the economic rise of Asia and the expanding footprint of Asian companies, the imperative to conduct a physical climate risk assessment and understand vulnerabilities to physical climate risks across a company’s operating locations is only increasing. This assessment would help companies safeguard their long-term interests and answer to customers, investors, regulators and other stakeholders.
Alex Pui, Head Sustainability and Natural Catastrophes, Asia Pacific, Swiss Re Corporate Solutions:
Our physical climate risk assessment framework is scientifically robust. What sets us apart is our long history (over 150 years) of real-world commercial applications through underwriting climate-related natural catastrophe risk. We achieve alignment with our prospective clients through a vested interest in making the world more resilient by keeping risk pools sustainable and affordable. Our experts harness Swiss Re’s collective risk knowledge to address our customers’ needs and with Climate Risk Solutions for Corporates we can deliver climate insights through a user-friendly and intuitive platform enabling rapid visualization of portfolio risks.