As COP26 talks begin to draw towards conclusion, it appears increasingly clear that resolutions around the key talking point – emissions reduction – will be limited and at best will likely guide towards establishing stronger targets by the end of next year.
There are no firm targets in the initial draft COP26 text towards the phasing out of coal and subsidies for fossil fuels, although the text does call on governments to accelerate these actions.
One positive move is the recognition of loss and damage in the draft text and the emphasis on the need for finance to help support adaptation among vulnerable countries.
Mami Mizutori, assistant secretary general and special representative of the secretary general in the UN Office for Disaster Risk Reduction, believes COP26 has “moved the needle” on adaptation and resilience.
Mizutori said risk and resilience have now become an “integral part of climate discussions”, with a stronger focus on adaptation than in previous COP meetings.
He also highlighted how the private sector has scaled up its efforts on climate finance, alongside commitments from several governments although the $100bn a year pledge has not yet been met.
The recognition that strategies and adaptation plans must be risk-informed presents an opportunity for insurers to play an important role in the process.
The risk expertise across the industry could prove invaluable as the world adapts to the impacts of climate change.
The work of the Insurance Development Forum (IDF) to develop tools to enhance understanding of risk in vulnerable countries can play a vital role in helping facilitate the use of risk transfer as a resilience mechanism.
As risk and resilience rises up the agenda, so also does the industry’s profile as a potential force for good.
In today’s Daily COP26 bulletin, we also hear from Conduit Re executive chairman Neil Eckert who throws his support behind the development of a universal approach to carbon scoring after acknowledging the challenges in assessing the carbon intensity of an underwriting portfolio.