Charles W. Elliott
A global pre-eminent insurance market is waving red flags about the risk of climate-change shocks to our world food system that could quadruple the price of basic food commodities, cause widespread famine and social instability, and bring down governments. Are world capitals paying attention?
Adding to the chorus of voices warning of threats to the global food system caused by climate change is global insurer Lloyds, which recently issued its report, “Food System Shock: The insurance impacts of acute disruption to global food supply“. Food System Shock is one in a series of Lloyd “emerging risk” reports that address risks that are “perceived to be potentially significant but which may not be fully understood or allowed for in insurance terms and conditions, pricing, reserving or capital setting.” This is not the first risk report on climate change issued by Lloyds (see, Lloyds’ Catastrophe Modelling and Climate Change (2014)), nor the first to address global food security (see, Lloyds’ Feast or Famine (2013)). But it is the first by Lloyds to connect these two, explicitly addressing the impacts of climate change on food production and follow-on effects to society in a globalized economy.
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