Amy Barnes

One of the fantastic things about having a price for risk is it incentivizes you to invest in resilience.

And we know that investments in preventative measures have a payback of 10 to 13 dollars for every dollar spent.

So as an industry, we need to do far more to tell people that prevention saves money.

Now, the cheapest time to invest in resilience is when you build new things.

We should only build resilient new structures.

But 80 to 85 of the buildings that exist everywhere in the world today will still be here in 2040.

So that means we also need to retrofit.

Some of those actions may be things like lifting electrical equipment off the ground floor of buildings to reduce damage from flood, or you may need to replace the shingles on your home with a living roof to make you more resilient to wildfire.

but these cost money, and some of the interventions cost a lot of money.

Now, there are grants and there are resilience bonds that can help with this, but their scale is woefully inadequate.

So as an insurance industry, we need to do more to promote preventative measures so that we're reducing the risk now and saving for the future.

Now, there are lots of roles for insurance to support climate change.

One other that I want to mention is, I've been talking about the impact of insurance on property damage.

But there's a type of insurance called parametric insurance that supports people in stresses like

extreme heat or water stress.

And right here in Kenya, we have a program supporting small-scale farmers.

So in the events that the rains don't come and the crops fail, or in India, where extreme heat means it's unsafe to work in the market, the microinsurance can replace people's livelihoods.

And these insurances are impacting hundreds of thousands of people's lives globally for the better.

But these insurances, too, will become unavailable and unaffordable if the risk becomes a certainty.

So insurance is doing exactly what it's supposed to.