Below 2 degrees: insurance for a low carbon economy
This report provides a strategic overview of the potential effects of the low carbon transition on the general insurance market. Vivid Economics and experts from the London School of Economics Grantham Research Institute were engaged by Lloyd’s to review the effects of decarbonisation scenarios on sectors and regions of the global economy, and the attendant opportunities and challenges this poses for the insurance sector in general and the Lloyd’s market in particular. The work focuses on the impact of transition and liability risks on general insurance, seeking principally to understand sectoral trends up to 2030, which will inform risks and opportunities over the next 3-5 years.
The work offers includes five sector deep dives that draw out opportunities and challenges from decarbonisation for insurers in greater detail. The case studies cover the Coal, Marine, Construction, Solar PV and Biofuel sectors and consider how risk profiles are expected to shift as a result of the transition to a low carbon economy, and the implications of this for insurers and risk managers.
Date: March 2020