If there is any business that has a vested interest in understanding the risks of climate change, it's the insurance industry. It's difficult to prove that any individual storm, drought or other natural disaster can be blamed on climate change, but insurers have to take a hard-nosed approach to risk, and they are taking climate change seriously.
Yesterday was the opening of a three-day conference in Cape Town hosted by Santam, UCT's Centre for Criminology and research-based consulting firm, Partners for Change. The conference sets out to create opportunities for discussions on understanding climate change; the need for resilience and adaptation; and the role of business - and specifically, insurers - in mitigating environmental change. The "Ecocentric Journey" conference opened with a speech by Professor Clifford Shearing of the Centre for Criminology.
A changed climate means a changed risk environment, with which insurance must deal.
Explaining the perhaps obscure role of the Centre of Criminology as a sponsor of a climate change conference, Shearing pointed out that criminology, too, is concerned with risk mitigation and security. The insurance industry, he said, is concerned with security and played a key role in the emergence of the massive private security industry in South Africa. "Like insurance, criminology deals with security; there is no bigger threat to security today than climate change."
Adaptation in relation to environmental risks is a major imperative for insurance companies. What is becoming increasingly apparent is that many of these risks are not acts of God but the effect of human activity. "We are learning that these events are not beyond human control, but indeed are very much the result of human action as we live in our economies," said Shearing.
The insurance industry, said Shearer, will play a potentially pivotal role in creating regulations and incentives which will persuade clients to place themselves in a better position to adapt to and mitigate the effects of environmental change.
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