Climate Science: A Summary for Actuaries - What the IPCC Climate Change Report 2021 Means for the Actuarial Profession
- March 2022
Webinar held on April 13, 2022:
by Valérie Masson-Delmotte
by Yordanka Velichkova
by Rade Musulin
This Summary, based on the IPCC Working Group I Sixth Assessment Report released in August 2021, is tailored to the actuarial community to provide helpful insights into what the IPCC report means for the Actuarial profession.
The IPCC Working Group I report addresses the most up-to-date physical understanding of the climate system and climate change. It brings together the latest advances in climate science, combining multiple lines of evidence from paleoclimate, observations, process understanding, and global and regional climate simulations to get the clearest picture of past, present, and possible future climate.
Actuaries, as risk professionals, need to understand the physical impacts of climate systems and climate changes. Such impacts will affect how risks are underwritten, priced, managed, and reported, whether for general, life or health insurance, pensions, other financial institutions, or social security. It is important for actuaries to understand the magnitude of the potential changes, the uncertainty of their frequency and intensity, and the inherent volatility of such risks.
Each of the physical changes analyzed in the latest IPCC Working Group I report could have an impact on human well-being and the long-term sustainability of the environment. Within these changes, actuaries are particularly interested in the effect of climate change on floods, droughts, fires, storms, rise of sea level, air pollution and the long-term effects of climate change. The Summary focuses on the physical changes affecting the most common perils analysed by actuaries and is supplemented with two Annexes on data and regional specificities and a glossary to support its users.
Citation: IAA, 2022. Climate Science: A Summary for Actuaries. [Sarah Connors, Micheline Dionne, Gábor Hanák, Rade Musulin, Neil Aellen, Muhammad Amjad, Steven Bowen, Daniel Ruiz Carrascal, Erika Coppola, Eric Dal Moro, Alessandro Dosio, Sergio Henrique Faria, Thian Yew Gan, Melissa Gomis, José Manuel Gutiérrez, Pandora Hope, Robert Kopp, Svitlana Krakovska, Katherine Leitzell, Douglas Maraun, Valérie Masson-Delmotte, Robin Matthews, Tom Maycock, Sharanjit Paddam, Gian-Kasper Plattner, Alex Pui, Mohammad Rahimi, Roshanka Ranasinghe, Joeri Rogelj, Alex C. Ruane, Sophie Szopa, Andrew Turner, Robert Vautard, Yordanka Velichkova, Andreas Weigel, Xuebin Zhang]. International Actuarial Association.
||Pension Fund Environmental, Social and Governance (ESG) Risk Disclosures: Developing Global Practice - December 2020 - This paper summarizes the main features and trends in pension fund ESG risk disclosures around the world available to regulators, members and the public. Pension fund ESG risks are important in terms of long-term fund performance and delivering members’ benefits, as well as in relation to wider societal impacts, and this is a rapidly developing area. Based on the information gathered via a survey of 14 countries, the paper looks at how local legislation, type of pension fund, size, structure and available resources, among other factors, affect pension funds engaging in ESG disclosures.
The paper highlights important issues and trends relating to ESG disclosures that actuaries involved with pension funds, whether as trustees, investment managers, investment consultants or advisers on funding or governance, should be aware of, so that they can ensure their clients or employers address the challenges on a timely basis. It is also relevant to the wider pension fund community.
Webinar on January 21, 2021