Climate Change Assessments

Climate Change Risk Assessments Are Critical

How susceptible are your facilities to climate-related perils now and in the future? A Climate Change Risk Assessment provides critical information about your risk of tropical cyclone, river flood, sea level rise, fire stress, drought, heat, precipitation, and wildfire – and how those risks may intensify by 2030, 2050, and 2100.

Climate change risk reports not only empower risk managers to take necessary protections against climate threats, but they also satisfy EU Taxonomy and Environmental Safety and Governance (ESG) requirements. Reports can be developed for single locations or portfolios with thousands of properties.

What’s Included in a Climate Change Assessment

Climate Change Assessments analyze the likelihood of climate-related perils impacting your facilities. Loss estimates can also be provided for certain perils. These assessments analyze the following risks:

• Tropical cyclone. The tropical cyclone hazard score is derived from globally consistent, basin-specific models for tropical cyclones, and is based on probable maximum wind intensities with a return period of 100 years.
• River flood. This analyzes areas threatened by extreme floods. Flood maps with return periods of 100 and 500 years. Current River Flood hazards zones from JBA data, projected River Flood hazard zones with return periods of 100 and 500 years for respective projections year and RCP scenario, using CMIP5 climate models and global land surface models to estimate changes in peak water runoff.
• Sea level rise. Hazard zones derived from IPCC sea-level rise data and high-resolution elevation data for respective projections year and RCP scenario. Model is based on storm surge events with 100 years return period.
• Fire weather stress index. Fire Stress Index describes current meteorological fire conditions on the basis of fire danger modelling, namely the Fire Weather Index (FWI). The FWI combines the probability of ignition, the speed and likelihood of spread and the availability of fuel to a combined metric. Fire Stress Index includes information about aspects like length of fire season and extreme fire danger days.
• Drought stress index. Drought Stress Index for respective projection year and RCP scenario describes change in water balance (precipitation minus potential evapotranspiration) derived from modelled Standardized Precipitation Evapotranspiration Index (SPEI). SPEI is a multiscale drought index based on climate data, used to determine duration, intensity, and severity of drought conditions with respect to normal conditions.
• Heat Stress Index. Heat Stress Index describes meteorological threat of heat stress, derived from information about things such as heat waves, annual maximum temperature, and tropical nights.
• Precipitation Stress Index. Precipitation Stress Index describes the threat of high precipitation, derived from information such as single-day high precipitation events and prolonged precipitation events.

7 Reasons to Implement Climate Change Assessments Now

Climate risks are expensive. Global economic losses from natural disasters in 2022 cost $275 billion USD, according to Swiss Re. Insured losses represented 45% of that damage, the fourth highest total for a single year.

Anticipate future financial risks. Climate-related perils may not be impacting your business today but could have a dramatic impact in the future. Our climate risk reports offers estimated financial damages to your organization’s property in 2030, 2050, and 2100.

Improved risk strategy. Climate Change Assessment reports empower company leaders to future-proof risk management strategies.

Increased regulation. The European Green Deal is an initiative aiming to set the EU on a path to carbon neutrality by 2050 with important regulations that European businesses and companies doing business in Europe must follow.

Finance improvements. Climate Change Assessments give companies the information necessary to get financing for climate change adaption such as repairs, and upgrades based on Appendix A of the EU Taxonomy requirements.

Consumer expectations. Consumers are voting with their wallets. If you don’t showcase plans to become more sustainable and take action on climate change, you may lose market share to competitors.

Insurability. Organizations must demonstrate a proactive push on climate change risks as insurance capacity continues to reduce. In fact, traditional capacity in 2022 reduced by 20-25% vs. 2021.

The Scientific Framework Behind Our Reports

Climate Change Assessments from Global Risk Consultants are powered by Munich Re, a leader in climate hazard assessment services. The assessments are based on the Intergovernmental Panel on the United Nations Climate Change (IPCC) framework which formed the basis of the 2015 Paris Agreement. Munich Re uses a Representative Concentration Pathways (RCP) for atmospheric greenhouse gas concentrations from the fifth IPCC Assessment Report (IPCC AR5, 2014).

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