Swiss Re Corporate Solutions has launched its Climate Risk Solutions for Corporates in Asia-Pacific to help companies assess the impact of physical climate risk on their global portfolios.
According to Swiss Re’s commercial insurance arm, the suite of climate risk solutions is underpinned by the firm’s Climate Risk Score Framework, which 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.
It encompasses three tiers, including a portfolio overview in the form of a climate risk score report at the entry level, and the provision of risk mitigation and risk transfer options at the highest level of the service offering.
The climate risk exposures covered by the package include river and flash floods (wet), wildfire and droughts (dry), and storm surges and coastal flooding (sea level rise). Clients can also look deeper into identified climate “hotspots”, in order to generate explicit economic loss costs associated with climate change impacts.
According to Swiss Re Corporate Solutions, a physical climate risk assessment can help companies to identify, mitigate, and transfer some of these risks to their operations and portfolios.
Asia-Pacific is home to many of these climate hotspots, with the region disproportionately affected by climate change and secondary perils. Swiss Re’s latest Sigma report showed that Asia-Pacific was hit by 81 large catastrophic events in 2020, leading to 26% of global economic losses. Insured losses from natural catastrophes were US$10 billion (SG$13.26 billion), representing a US$53 billion protection gap to the total US$63 billion in economic losses incurred.
“Climate change is resulting in greater frequency and intensity of extreme weather events and natural catastrophes,” said Jonathan Rake, Asia-Pacific CEO of Swiss Re Corporate Solutions. “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.”
