Risk managers in the insurance industry must lead the way to build greater resilience, the UN secretary general for climate change, Selwin Hart, has told the COP26 meeting in Glasgow.
Addressing an Insurance Development Forum-hosted event, Hart called for the creation of more affordable and flexible sector-based insurance solutions for the poor, as well as the expansion of country coverage and access to premium and capital support where necessary.
Hart called on donors to recognise the value of investment in adaptation measures following a commitment by the UK and Germany to provide £120mn for early action, disaster risk and insurance.
“Resilience makes economic sense: A $1.8trn investment in adaptation measures would bring a return of $7.1trn in avoided costs and other benefits,” he said.
“We are staring down the barrel of a humanitarian catastrophe of staggering proportions, as climate change puts more lives, livelihoods and properties at risk.
“Countries need finance and financial tools to cope with the growing risks, rather than focus on the aftermath.”
The UN has called for donor countries and multilateral development banks to allocate at least 50 percent of climate finance to adaptation, compared with just 25 percent today.
“We know that adaptation and resilience projects and programs are harder. The transaction costs are higher, and the return on investment lower. But failure to address adaptation and resilience at the scale required will be measured in loss of lives and livelihoods.
“And this burden will fall disproportionately and unfairly to those who have contributed least to the climate crisis.”