BIBA 2024: Climate impact real and is driving demand says Kumar

The growing threat of climate change has seen increasing numbers of businesses and local authorities looking to enhance the resilience of their operations as the impact of extreme weather events increases.

As brokers and insurers met in Manchester this week at the annual BIBA conference Kumu Kumar, (above) head of Zurich Resilience Solutions UK and chief risk engineering officer UK told Emerging Risks that the demand for support from insurers is growing.

“Risks have changed significantly in the past year,” he explained. “People’s understanding of the sophistication needed to cope with global risks has risen as the risks have become more apparent.

“We have the crises in the Middle East, the Red Sea and Ukraine. Geopolitical risks are combined with supply chain risks which are combined with climate risks. What has become clear is addressing one will not provide the answer to all three.”

Kumar cited the example of the city authorities in Madrid which are working with ZRS on the steps that need to be taken in the wake of extreme temperatures which have hit the Spanish capital.

He explained that the insurer is working with the authorities to look at how they can make the city more resilient to the threat of further heatwaves as temperatures increase.

“We are discussing a wide range of issues with the government of Madrid; these include better building standards and rules which will use permeable materials which can absorb water and with it reduce the amount of heat they can retain and radiate,” he added. “What is clear is that we need to work in a different way when it come to how we build our cities. It might mean more green spaces and increase shade on streets to protect pedestrians.”

Kumar continued: “It is clear the conversations with businesses and government are turning to adaptation and increase resilience to the impacts of climate change that we know are already hear and will only increase.

“Companies are coming to us with concerns around climate change. We are working with them to assess the risks, model the impacts now and in the future.”

He explained that the task was to understand the business and better model the exact impact that climate change will have on their specific operations.

“In past years the companies looked at climate change as it was driven by governance issues. Now they have seen how it is actually impacting their business and the approach has changed. We are seeing storm surges, rising sea levels and more extreme rainfall causing landslips which can threaten homes and businesses.

“If we consider this winter the sheer volume of the rainfall, we have seen simply cannot be managed by Victorian drainage infrastructure.”