Insurance, Increasing Natural Disaster Risks and the SDGs: A Focus on Southern Africa

Abstract

We are living in the Anthropocene. It is an era characterized by the prevalence of human-induced global environmental crises resulting from interactions between humankind and the biophysical environment such as climate change. The increasing frequency and magnitude of these environmental-related risks and uncertainties directly impact on the insurance industry and have influenced insurance considerations for clients. Such risks present both liabilities and business opportunities to the insurance sector. The insurance sector has responded through the provision of environmental- and climate change-related insurance. By reducing the risks, the insurance sector contributes towards the attainment of the United Nations sustainable development goals (SDGs). This includes the provision of insurance products for, amongst others, new-generation agricultural policies (SDG 2), the protection of people and business against environmental health risks (SDG 3), protection of industrial infrastructure (SDG 9), the support for low-carbon industrial development (SDG 7), climate-related weather extremes (SDG 13) and sustainable production and consumption (SDG 12). In this chapter, we explore the impacts of local and global environmental risks on the insurance industry in Southern Africa and its responses as aligned to the SDGs. We also look at the insurance industry’s influence on client environmental protection and environmental sustainability considerations. Lastly, we highlight the transition towards increasing convergence of business interests, greener lifestyle choices and achieving environmental sustainability in the twenty-first century.